Romania’s annual inflation rate remains negative, but consumer prices go up in September

Consumer prices in Romania went up by 0.26% in September compared to August while the annual inflation rate remained negative at minus 1.7%, similar to July. Romania registered an annual inflation of minus 1.9% in August. In June this year, the annual inflation rate turned negative for the first time in the last 25 years. This was due to the VAT rate cut from 24% to 9% on food products and non-alcoholic beverages, which the Government applied starting June 1. Food prices increased by 0.9% month-on-month in September, and prices of services went up by 0.13%, according to recent data from the National Statistics Institute INS. The prices of non-food products went down by 0.15% in September compared to August. Potatoes were 21.3% more expensive in September compared to the month before, vegetables and canned vegetables had 7.9% higher prices, and citrus fruits were 4% more expensive. On the other hand, fresh fruits were cheaper by 1.8% in September. Among services, the ‘other services’ category registered a month-to-month increase of 0.9%, while the urban transport got 0.32% more expensive. Among non-food products, the furniture registered the highest price increase of 0.55%. Meanwhile, the fuels were 1.36% cheaper, and the prices of medical items and drugs decreased by 0.02%. Romania’s Central Bank warns about inflationary pressures next year. Romanian Banca Transilvania: Inflation stays negative until the end of 2016. Irina Popescu, irina.popescu@romania-insider.com