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Romanian PM Sees Inflation On Descending Path In Next Mos

Romanian inflation is seen continuing its descending path over the next months, Prime Minister Calin Popescu Tariceanu said, adding the recent salary increases will not be affected by price increases.
Romanian PM Sees Inflation On Descending Path In Next Mos
11 sept. 2008, 17:57, English

"The descending path of inflation will continue over the next months as well, therefore the wage hikes will not be eroded, Tariceanu said Thursday.

The Romanian government decided on Wednesday to increase the minimum monthly gross wages to 540 lei ($212.1), based on the agreement the representatives of the trade unions and ownerships signed with the government at the end of July.

Romania’s consumer price index fell by 0.09 percentage points on the month in August, driven by a decrease in prices for services, bringing the annual inflation to 8.02%.

August inflation was lower than expected and analysts say that this could determine the National Bank of Romania to keep or even lower the key monetary policy rate this year.

The central bank has hiked interest rates in seven consecutive moves sine October last year by 325 basis points to 10.25%, from 7%. 

The central bank sees inflation at 6.6% at the end of this year and at 4.2% at the end of 2009, compared with a target of 2.8%-4.8% and 2.5%-4.5% for 2008, and the following year, respectively.