Romania Feb Inflation Seen At +0.5% MM – Poll

“We expect demand pressure to gradually fall, which should translate in very little price increases,” ING Bank Romania economist Nicolaie Chidesciuc told a MEDIAFAX poll.

Chidesciuc said disinflation will continue until June, but after that the process could be discontinued and inflation might accelerate to 8% by the end of the year.

Florian Libocor, chief economist at BRD -Groupe Societe Generale, sees the monthly consumer price index at 0.3% in February and at 6.6% on the year.

“The inflation slowdown in February was driven by stabilization of the exchange rate and of prices in the “energy” category of products, as well as by a tempered internal demand,” Libocor said.

He said inflation will reach 5% by the end of 2009, a “slightly pessimistic, yet cautious level”, considering the global trend toward lower consumption prices.

On a more pessimistic note, Raiffeisen Bank Romania’s chief economist Ionut Dumitru said the monthly consumer price index grew by 0.7% in February, while the annual inflation widened to 6.7-6.8%.

In January, Romanian consumer price index rose by a higher than expected 1.24% compared with the previous month, and the annual inflation widened to 6.71%, from 6.3% end-December, according to the National Statistics Institute data.

The central bank targets a 3.5% inflation rate for 2009, with one percentage point variation band. It recently said it expects annual inflation to decrease to 4.5% by the end of 2009, from 6.3% in December 2008.