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October 22, 2021

Annual inflation rate drops to new historic low: 2.59 pc in February

Trade deficit of RON 2 bln in January, up by 82 pc compared to same month last year, INS informs.

The annual inflation rate dropped to 2.59 per cent in February, a new historic low, while the month-on-month hike in consumer prices stood at 0.64 per cent, the National Statistics Institute (INS) informs. In February the prices of food products grew by 1.2 per cent month-on-month, those of non-food merchandises grew by 0.4 per cent and those of services by 0.1 per cent, the INS data shows. The highest price hikes when it comes to food products were registered in the case of eggs (+12.7 per cent), vegetables and canned vegetables (+5.77 per cent), potatoes (+5.72 per cent) and fruits (+4.48 per cent). Honey was the only food product whose prices remained unchanged compared to January. In 2011 the prices of food products stagnated because of a bumper crop, which resulted in the annual inflation dropping to 3.14 per cent, the lowest level in the last 20 years. In 2012 however the agriculture sector could contribute to a hike in consumer prices, depending on how seriously the crops will be affected by the drought registered last autumn. In what concerns non-food products, price hikes of up to 1 per cent were registered in almost all categories – clothing, footwear, household goods etc. The highest hikes were registered in the case of cigarettes (+1.4 per cent). Refrigerators and freezers were the only products whose prices were lower than in January. “The average price hike in the last 12 months (March 2011 – February 2012) compared to the previous 12 months (March 2010 – February 2011), determined on the basis of the CPI, is 5 per cent, while that determined on the basis of the HCPI stands at 5.1 per cent,” the INS communiqué reads. Other possible inflationary factors consist of the liberalization of electricity and natural gas prices in Romania, and the price of oil at international level. The most recent prognosis of the National Bank of Romania points to an inflation rate low of 2 per cent at the end of Q1 and a high of 3.8 per cent in Q3. The BNR prognosis for the whole year points to an inflation rate of 3.2 per cent. The central bank revised its February prognosis from 3 per cent to 3.2 per cent because of the base effect. The new prognosis takes into account a diminished impact from regulated electricity and natural gas prices because the government has successfully negotiated with the IMF and the EC the postponement of a price hike. Analysts expect an inflation rate of 3.7 per cent this year.

Producers: Vegetable prices to drop by 50 pc this summer

Vegetable producers state that prices should drop in the following months given the hike in supply: “This year however the production has fallen one month behind schedule because of meteorological conditions. This is why the somewhat higher prices registered in February will drop slightly and will remain constant until May – June. After that, the prices will drop by half compared to February,” Aurel Tanase, general manager of the Prodcom Vegetable-Fruits Interprofessional Organization, stated for Mediafax. At the same time, he considers that in the case of fruits the prices will maintain throughout the year the level seen in February.


Ford Craiova expected to have positive influence on overall exports in 2012

Romania’s trade deficit stood at RON 2.004 (EUR 462.8 M) in January 2012, up by 82 per cent compared to the one registered in the same month last year (RON 1.101 bln). “Compared to January 2011, exports have grown by 2.9 per cent in RON-denominated values (1.4 per cent in EUR-denominated values), while imports have grown by 9.9 per cent (8.2 per cent). Compared to December 2011, in January 2012 exports have grown by 5.8 per cent in RON-denominated values (5.9 per cent in EUR-denominated values), while imports have dropped by 9.3 per cent in both RON and EUR-denominated values,” the INS communiqué reads. In January 2012 the following groups of products held significant shares in the structure of exports and imports: cars and transportation equipment (41.7 per cent of exports, 34.3 per cent of imports), and other manufactured products (35.5 per cent of exports and 29.6 per cent of imports). Ford Craiova is expected to have a positive influence on overall exports in 2012, the plant having announced that it will produce 60,000 B-Max units by December, 95 per cent of them set to be exported. The closing of the Nokia plant will have a negative impact on exports. Exporters have announced several times that they are facing problems because of the international recession and have asked for various measures of support from the authorities.

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