The annual inflation rate in Romania dropped to 4.6% in September 2024, down from 5.1% in August, new data from the country’s national institute of statistics (Insse) has found.
Year-to-date inflation in Romania stood at 3.8%, while over the past 12 months, consumer prices have risen by an average of 6.1%, the data showed.
Food products recorded a month-on-month increase in prices, of 0.79%, with items like vegetables and fruit experiencing sharp price rises (2.67% for vegetables, 3.18% for fruit).
In contrast, non-food goods remained stable, with a marginal drop in prices (99.98%).
Services saw a monthly rise of 0.39%, with higher costs noted in areas like medical care, hygiene, and rent.
On a year-on-year basis, meanwhile, food prices were 4.72% higher, non-food items were 3.3% higher, and services were 7.88% higher.
Analyst viewpoint
Commenting on the findings, Stefan Posea and Valentin Tataru, economists with ING, said that the drop in inflation was a “positive sign for the trend of easing price pressures. However, the details indicate that policymakers are still far from declaring victory.”
ING is anticipating a year-end inflation rate of 4.2% in Romania, with possible upside risks stemming from the recent rebound in global oil prices, as well as strong internal demand.
“There are also some key uncertainties next year, almost all pointing to upside risks at this stage,” the economists added. “Consumer energy prices have upside potential if the price caps are removed, while higher taxes could bring renewed pressures, depending on how the actual measures look. For now, it appears a broad tax reform package is more a matter for the second half of 2025 or even 2026.”
Rate cuts on the horizon
The current findings also present an opportunity for the National Bank of Romania to cut rates, they said, “The disinflation trend carries on as expected, though a touch above the latest NBR projections. In principle, this still brings some policy space for the NBR to cut rates.
“We continue to think that the Bank will remain cautious this year and refrain from another rate cut in November given the significant global and domestic uncertainties.”
Read ING’s assessment here, and the official Insse data here.
