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Romania’s Ctrl Bk Ups ’10 Inflation Forecast At 3.5%

Romania's central bank raised its forecast on 2010 inflation to 3.5%, from the previous 2.6%, central bank governor Mugur Isarescu told a news conference Friday.
Romania's Ctrl Bk Ups '10 Inflation Forecast At 3.5%
05 feb. 2010, 12:05, English

The central bank predicts the inflation rate will fall to 2.7% in 2011.

Isarescu explained the increased forecast siting a higher than expected price growth in January, following the increase of the tobacco excise tax.

In 2009, Romania’s central bank missed its inflation target for the third consecutive year, mainly due to increases in excise duties on tobacco and fuel prices.

The annual inflation rate stood at 4.74% in December 2009, 24 basis points above the upper limit of the variation band around the target of 3.5%.

In 2010, the central bank also targets an inflation of 3.5%, with one percentage point variation band around the target.

Isarescu also said that inflation might fall below the target, and even below the lower limit of the variation interval in the final months of the year.