Factory-gate prices for consumer goods in Romania increased at a moderate pace in March, with durable goods up 1.82% year-on-year and non-durable goods rising 5.0%, according to data published by the National Institute of Statistics (INS).

The figures point to a clear divergence between production costs and consumer price inflation, which remains close to 10% year-on-year. Part of the gap is explained by tax and utility adjustments, including a VAT increase implemented in August 2025 (with an impact of some 2 percentage points) and electricity market liberalisation effects (another 2 percentage points), which are not directly reflected in industrial price indices.

Import prices rose 4.8% year-on-year, below the 7.8% increase recorded for domestically produced industrial goods. The difference is largely attributed to the higher weight of energy-intensive products in local production costs, with energy sector prices increasing 11.7% year-on-year.

The data suggest that inflationary pressure is increasingly driven by administered prices and energy components rather than underlying consumer goods production costs. We expect headline inflation to gradually decline to the 5%–6% range by August 2026, not accounting for other impacts.

However, risks remain on both sides, predominantly upside. Elevated crude oil prices could reintroduce upward pressure on transport and production costs, while recent depreciation of the leu adds further import-side inflation risks. At the same time, weaker domestic demand is expected to exert downward pressure on prices over the medium term.

The INS figures indicate that, despite elevated headline inflation, underlying industrial price dynamics remain relatively contained in Romania’s consumer goods sector.

iulian@romania-insider.com

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