Radio România Internațional

Tag: reference interest rate

  • Updated inflation forecast

    Updated inflation forecast

    The National Bank of Romania has increased its estimate on the inflation rate in Romania for the end of 2024, from 4.7% to 4.9%. At the same time, the Bank maintained the inflation forecast for the end of next year at 3.5%. Central Bank Governor Mugur Isărescu on Wednesday presented an updated inflation report, explaining why the level of the inflation rate will exceed the original estimates at the end of the year. Inflation will continue its downward trajectory, although at a slower pace than expected, Isărescu said. The Central Bank is trying to lower inflation, without however triggering a recession, he added. The Governor of the Central Bank claims that returning the inflation rate to the reference target range will depend a lot on the timing the Bank decides to reduce the reference interest rate, but also on its level. At the start of the week, the Central Bank Board of Directors decided to maintain the monetary policy interest rate, also known as the “reference interest rate”, at the level of 7% per year.

     

     

    The Governor of the National Bank also said that a favorable evolution of the inflation rate this month could prompt the Board of Directors to decide to reduce the reference interest rate, which influences all interest rates charged by commercial banks. Such a decision, however, depends on the entire evolution of the local economy, as well as on international developments. However, Mugur Isărescu does not exclude the possibility that the decision will be postponed to the second half of the year or even be ruled out entirely for 2024. On the other hand, the Central Bank Governor said that revenues increase much more than productivity overall, which will have a significant impact on inflation, adding that he expects to see productivity increase as well. Mugur Isărescu referred to the latest statistical data, which confirms that the average net salary exceeded the equivalent of 1,000 EUR in March. The main uncertainties and risks regarding the evolution of the inflation rate continue to be related to fiscal and budget policies, being linked to the high budget deficit, the salary dynamics and the additional fiscal-budgetary measures that could be implemented in order to continue the budget consolidation. Other elements, such as the potential effects of the wars in Ukraine and the Middle East, also impact the evolution of the inflation rate.

     

     

    The annual inflation rate continued to decrease and reached 5.9% in April compared to 6.61% in March, the National Institute of Statistics announced this week. Prices for foodstuffs and services reported slight increases, below 1%. In contrast, prices for non-food products went down. According to the European Commission’s spring forecast, Romania’s economic growth remains one of the most robust in the EU, 3.3% per year. On the downside, Romania has the highest inflation rate at community level, almost 6%, nearly twice the European average. (VP)

  • March 29, 2018

    March 29, 2018

    WEATHER Weather is getting slightly warmer across Romania, so much so that temperature readings are getting closer to the season’s values for the most part of the country, save for the northwest and the far western part of the territory, where the skies are overcast and rainfalls have been reported, while temperature readings stand at unseasonably cold values for this time of the year. Sleet and snowfalls have been reported for high-altitude regions. The wind blows slightly to moderately, temporarily intensifying in the mountain regions, in the northwest and center, while fog has been forecast for the lower areas in the south and east. The highs of the day range from nine to seventeen degrees Celsius. The noon reading in Bucharest stood at 9 degrees Celsius. Hydrologists have renewed their code yellow and orange alerts for flooding, in place until Friday afternoon, for 12 rivers in the south, southwest, center and northeast. In the wake of the heavy rainfalls in the past days, some of the segments of the Danube have been placed under the incidence of a series of code yellow and orange alerts for flooding, in place until the beginning of April.





    KOREA South Korea’s president Moon Jae-in is to meet north-Korean leader Kim Jong-un on April 27th. The meeting was announced after officials from South and North Korea had held talks in the border village of Panmunjom. Kim Jong-un has reiterated his pledge to scrap his country’s nuclear programme during a surprising visit that he paid to China this week. South-Korean government has said this is going to be the most important topic of discussion because there is concern the north-Korean leader is not ready to give up his arsenal so easily. The meeting will try to pave the way for the possible meeting between US president Donald Trump and the north-Korean leader.





    ORDINANCE The government in Bucharest is today tackling an emergency ordinance, which brings fresh amendments to the Fiscal Code. One of these amendments is allowing companies to choose between the profit tax and turnover if they are under the one million euros threshold. According to Public Finance Minister Eugen Teodorovici, another amendment deals with reimbursing the environment tax for applicants who can produce their personal numeric code. The amendments also include a decision to raise from 2% to 3.5% the income tax share for natural persons, which could be earmarked for the NGOs.





    PROTESTS Trade unions from Romania’s healthcare system on Thursday picketed the Labour Ministry in Bucharest. The protest today comes after the similar actions medical personnel mounted in front of the field ministry on Tuesday. The protesters have called for pay rises beginning March 1st for the entire medical and social assistance employees. They have also asked the authorities to stop keeping the bonus ceiling at 30% at the same time allowing the employees to offset the losses they suffered after new payment regulations had come into effect on January 1st. According to Health Minister Sorina Pintea, the executive’s agenda today also includes bonus regulations for the medical personnel. The minister has explained the personnel will benefit from bonuses according to their skill levels. Against the background of severely underfunded medical services, Romania has for years seen a massive exodus of doctors and nurses who left for better jobs abroad.





    BNR Romania’s Central bank had to raise the reference interest rate twice due to accelerated inflation rate with major effects over the economic environment, Central Bank governor Mugur Isarescu said on Thursday before the Senate’s economic committee. According to him, the current account deficit has increased more than in other countries in the region and the pressure on the national currency has been higher. Data released by the National Institute for Statistics show that the annual inflation rate showing the evolution of consumption prices in the past year reached 4.72% in February, a record high since 2013. At the same time the Central Bank has recently raised for the second time this year the reference interest rate from 2% to 2.25% a year.



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