Mugur Isarescu: Inflation to stay negative until July

Newsroom 05/05/2016 | 17:09

Romania’s inflation will stay within negative territory longer than previously forecast, BNR’s governor Mugur Isarescu stated during a press conference. Though previous estimates had placed the end of the interval in May 2016, BNR has moved it due to “transient effects of the reduction in VAT and other indirect taxes and also due to a drop in administered prices (energy),” the central bank representative explained.

He added that the inflation is expected to return to the stationary target band of 2.5 percent at the end of the forecast horizon (two years).

The prognosis had been revised in February to 1.4 percent at the end of this year from the previous 1.1 percent forecast in November 2015. By the end of 2017 inflation is expected to reach a comfortable 3.4 percent.

The National Prognosis Commission (CNP) maintained in its winter forecast the previous estimates of 1.8 percent for this year and 2.5 percent next year.

Natalia Martian