ECONOMY FINANCE&BANKING

Romania, among EU countries with lowest inflation rate in July

The annual inflation rate in the European Union (EU) leveled off in July as compared to June at 1.5 pct, the lowest annual rates being recorded in Ireland (minus 0.2 pct), Cyprus (minus 0.1 pct), Bulgaria and Finland, both with an annual inflation of 0.6 pct, France, 0.8 pct, and Romania, 0.9 pct, according to data released on Thursday by Eurostat.

As compared to the June 2017 situation, the annual inflation rate dropped in four member states, remained stable in eight countries and increased in 16 member countries, Romania included, from 0.7 pct in June to 0.9 pct in July.

In the euro area, the annual inflation rate remained stable in July at 1.3 pct. The most significant impact on the annual growth of prices in the euro area was recorded by accommodation services (0.10 percentage points), tourist packages (0.06 percentage points) and air transport (0.05 percentage points). On the other hand, the most significant negative impact on inflation came from telecommunications services (minus 0.11 percentage points), vegetables (minus 0.05 percentage points) and fruits (minus 0.04 percentage points).

As far as Romania is concerned, the data previously released by the National Institute of Statistics (INS) show that the annual inflation rate was 1.4 pct in July, up from 0.85 pct in the previous month.

The National Bank of Romania (BNR) revised its inflation forecast for the end of this year at 1.9-percent, against a previously estimated inflation rate of 1.6 percent, down 0.1 percentage points. For the end of 2018, BNR estimates an inflation rate of 3.2 pct, from 3.1 pct previously, and for the end of the first half of 2019, an inflation rate of 3.5 pct is expected.

According to BNR, the reintroduction of the annual Consumer Price Index (CPI) inflation rate in the target range is expected to take place in the third quarter of 2017.

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