BNR According to Romania’s Central Bank (BNR), the country’s inflation rate is expected to increase in the following months more than it was initially estimated. So, Romania’s inflation rate will exceed the level of 11.2% forecast in June. The phenomenon was caused by the latest price hikes in fuel and processed food against the war in Ukraine and the international sanctions imposed on Russia. In another development, although pressure for pay rises might be felt at least in the sectors facing a shortage of qualified personnel, substantial pay rises are very unlikely to happen in the near future. We recall the annual inflation rate went up to 10.15% in March from 8.5% in February reaching the highest level in the past 18 years.
RATING Romania’s Finance Minister Adrian Câciu hailed the Friday’s decision of the financial rating agency Standard & Poor’s to reconfirm Romania’s Sovereign credit rating to ‘BBB minus’ with stable outlook. ‘This is another proof that the national policies of funding the economy were right’ Câciu says. According to Standard & Poor’s, Romania’s rating is underpinned by EU membership and international capital flows. At the same time the risks posed by the war in Ukraine are diminished by the prospects of absorbing a major volume of EU funds as well as by the low energy dependence on imports of natural gas and oil from Russia. However, the agency has significantly dropped the country’s growth estimates down to 2.1% and has increased estimates regarding the inflation rate, which in 2022 is expected to go up to 9% as compared to 6% forecast in December. Another major rating agency Fitch last week confirmed Romania’s rating at ‘BBB minus’, with negative outlook, the last notch in the investment-grade category.
