Romania's Central Bank sees inflation at 0.2%

The Romanian Central Bank (BNR) estimates for the end of the year an annual inflation rate of 0.2%. It has revised it down from 2.1% because of the VAT cut on food and beverages starting June 1. The annual inflation rate will fall to -1% during the summer and the autumn, according to BNR. It will slowly grow in the last quarter, reaching 0.2% at the end of the year. For December 2016, the Central Bank has also revised down the inflation rate from 2.4% to 1.9%. The VAT cut will bring the inflation rate around zero for about one year. Then, the annual inflation rate will consolidate to about 2% in two years. The European target is also 2%, said BNR governor Mugur Isarescu. editor@romania-insider.com