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Investing.com -- Romania’s inflation rate increased to 5.45% year-over-year in May from 4.85% in April, exceeding the market consensus of 5.3%, according to recent data.
The rise in annual inflation was primarily attributed to unfavorable base effects related to food and fuel prices. Seasonally adjusted data indicates persistent elevated inflationary pressures in core and services sectors.
Citi maintains its year-end inflation forecast for Romania at 4.3% year-over-year, though notes that risks are tilted to the upside.
"Given this backdrop, combined with elevated fiscal and political uncertainty, we anticipate that the central bank will maintain its current policy stance until the fourth quarter," Citi stated in its analysis.
The Romanian central bank is expected to keep its monetary policy unchanged through the third quarter of the year as it navigates these inflationary pressures amid fiscal and political uncertainties.
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