BUCHAREST (Romania), October 9 (SeeNews) – Romania is expected to switch back to monthly inflation in September after reporting deflation in the previous two months, analysts said.
The median forecast of four local bank analysts polled by SeeNews earlier this week put the September monthly inflation at 0.2%, compared to a 0.19% deflation in the previous month. Annual inflation is seen at between 4.6% and 5.0%, versus 4.96% in August.
Romania’s statistics board, INS, is expected to release September consumer price index (CPI) data on October 12.
“The inflation rate will fit within the [central bank’s] target this autumn as a result of shrinking aggregate demand with direct effects mostly on food prices, of exchange rate's relative stabilisation, and unchanged government-administered prices of energy,” Lucian Anghel, chief economist with Banca Comerciala Romana, told SeeNews.
The Romanian currency, the leu, stood at 4.2389 per euro last month, compared to 4.2185 per euro in August, measured by the central bank’s average monthly exchange rate.
Romania’s central bank, BNR, has set its end-year inflation target for both 2009 and 2010 at 3.5%, with one percentage point variation band on either side, in accordance with the country’s funding arrangement with the International Monetary Fund (IMF).
In August, BNR cut its 2009 inflation forecast to 4.3% from 4.4%, within its target band for the year, and lowered its 2010 CPI projection to 2.6% from 2.8%.
Crisis-hit Romania struck a 20 billion euro ($29.5 billion) loan deal with the IMF, the European Union and the World Bank in late March. The two-year package focuses on Romania’s external and fiscal imbalances and on supporting its financial sector.
Romania’s end-2008 consumer price inflation slowed to 6.3%, way above the upper limit of the central bank’s 2.8%-4.8% target band for the year. End-2007 inflation was 6.6%.
The four analysts polled by SeeNews made the following projections for Romania’s inflation rate:
|Georgiana Constantinescu (Credit Europe Bank)
|Lucian Anghel (Banca Comericala Romana)
|Ionut Dumitru (Raiffeisen Bank)
|Rozalia Pal (UniCredit Tiriac Bank)
($ = 0.6786 euro)