Romania Inflation Quickens to 5.3%, Fastest in a Year, on Food
Romanian inflation accelerated to the fastest in more than a year in September, more than estimated, as food and energy price increases pushed the rate over the central bank’s forecast for the third quarter.
The inflation rate rose to 5.3 percent, the highest since June 2011, compared with 3.9 percent in August and the central bank’s forecast of 3.5 percent, the Bucharest-based National Statistics Institute said today by e-mail. The figure exceeded the 4.7 percent median estimate of 13 economists in a Bloomberg survey. Prices rose 1.2 percent from August.
The Banca Nationala a Romaniei, which has a 2012 inflation target of 2 percent to 4 percent, kept its benchmark rate unchanged at its meeting at a record low on Sept. 27 to weigh the impact of accelerating food-price growth because of a drought as economic growth slows.
“Another upside surprise in inflation -- which exceeded the consensus both in August and July -- could fuel expectations of tighter liquidity conditions, as the first form of monetary policy tightening is envisaged,” Raiffeisen Bank Romania SA economist Ana-Maria Morarescu said before the report.
The inflation may quicken this year more than the central bank’s 3.2 percent forecast due to political turmoil that plunged the leu to a record low and a drought that boosted prices for imports and food, Governor Mugur Isarescu said Aug. 6. This year’s rate is likely to stay within the bank’s target, he said at the time.
Food costs rose 6.9 percent in September from a year earlier, compared with a 3.3 percent growth in August, driven by rising vegetable and fruit prices, according to the institute. Inflation for non-food items quickened to 4.3 percent, compared with 3.9 percent in August, after the country raised natural-gas prices to meet pledges to its international lenders.
Service-price growth slowed to 4.8 percent in September from a year earlier, compared with 4.9 percent in August, the institute said.
Industrial output contracted a seasonally adjusted 1.1 percent in August from a year earlier, after a 1.9 percent gain in July, the institute said in a separate release today. Output shrank 1.1 percent on the month.
-- With assistance from Barbara Sladkowska in Warsaw. Editors: James M. Gomez, Jeffrey Donovan
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