Inflation engines are slowing down, the annual rate dropped to 15.3% in October, compared to 15.8% in September

By RBJ
The annual rate of inflation dropped to 15.32% in October this year, from 15.88% in September, as the prices of food goods increased by 20.58%, those of non-food goods were higher by 14.37%, and services were more expensive by 8.31%, according to the data published on Friday by the National Institute of Statistics (INS).
“Consumer prices in October 2022 compared to September 2022 increased by 1.3%. The inflation rate since the beginning of the year (October 2022 compared to December 2021) is 14.5%. The annual inflation rate in October 2022 compared with the month of October 2021 is 15.3%. The average rate of change in consumer prices in the last 12 months (November 2021 – October 2022) compared to the previous 12 months (November 2020 – October 2021) is 12.4%”, it is said in INS press release.
According to the cited source, the harmonized index of consumer prices in October 2022 compared to September 2022 is 101.35%. The annual inflation rate in October 2022 compared to October 2021 calculated on the basis of the Harmonized Index of Consumer Prices (HICP) is 13.5%. The average rate of change in consumer prices in the last 12 months (November 2021 – October 2022) compared to the previous 12 months (November 2020 – October 2021) determined on the basis of the HIPC is 10.8%.
The National Bank of Romania mentioned, on Tuesday, in a press release, that the annual inflation rate is expected to increase moderately towards the end of the current year, and then enter a gradual downward trajectory, which drops to the single digit level in the semester I 2024.
“According to the updated forecast, the annual inflation rate is expected to increase moderately towards the end of the current year, and then to enter a gradual downward trajectory, which drops to the level of one digit in the first semester of 2024 and is accentuated thereafter, still remaining at the end projection horizon slightly above the target range. The perspective of the reversal of the trajectory of the annual inflation rate after reaching a plateau in the fourth quarter of 2022 has as its springs the mitigation of the impact of global shocks on the supply side – including in the context of the application of energy price ceiling schemes until August 2023 – as well as the increasingly significant manifestation of some basic disinflationary effects, alongside the influences arising from the probable restriction and rapid closure of the aggregate demand surplus, followed by a relatively more accelerated deepening of the GDP gap into negative territory starting from the IV quarter of 2023”, it was said in the BNR press release.
In August, the governor of the National Bank of Romania, Mugur Isărescu, announced that the inflation forecast for the end of this year is estimated at 13.9%, and for the end of 2023 at 7.5%. In May 2022, the BNR estimated inflation of 12.5% ​​for the end of this year and 6.7% for 2023.
The International Monetary Fund revised significantly upward the estimates regarding the advance of consumer prices in Romania both for this year, from 9.3% to 13.3%, and especially for next year, from 4% to 11%, shows the latest “World Economic Outlook” report, published on Tuesday by the international financial institution.