Romania’s central bank raised its main interest rate by half a percentage point, to 6.75% as it continues to battle high inflation.
The central bank expects the prices will continue to grow rapidly by the end of the year, with the inflation rate considerably above its target interval. In September, the annual inflation rate was 15.9%, up from 15.3% in August.
Consumer prices rose significantly this year in Romania, and the inflation rate reached levels not seen in almost two decades, mostly due to higher energy prices.
The central bank expects inflation to decrease only next year and the rate coming down to single-digit territory no sooner than the first half of 2024.
Meanwhile, the bank also expects decreasing demand, which would negatively impact growth. The bank thus predicts a quasi-stagnation of the economy in the last quarter of 2022 and growth below potential over the following year.
(Bogdan Neagu | EURACTIV.ro)
Source: euractiv.com
