Raiffeisen Sees Romanian Inflation Below 2.5% In First Half Of 2012
Romania’s inflation might temporarily declined below 2.5% in the first half of next year, mainly due to a favorable statistical base effect, but the central bank might reduce the key rate b 0.5 percentage points in the same timeframe, according to an analysis by lender Raiffeisen.
“We expect the central bank to calibrate the stance of the monetary policy based on (1) dynamics of underlying inflationary pressures, (2) inflation projected one year from now, and (3) the risks to inflation projection. We expect the central bank to cut the monetary policy rate by 50 basis points in the first half of 2012,” the analysis reads.
Inflation gained 0.42% in November compared to October, while annual inflation dropped to 3.44% from 3.6% in October. In September and November, inflation hit two new lows since 1990, namely 3.45% and 3.44% respectively, as the annualized effect of the 2012 VAT increase disappeared.
The central bank’s managing board reduced in November the key rate to 6% from 6.25%.
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