Page 64 - bne IntelliNews Southeastern Europe Outlook 2025

4.5 Inflation & Monetary Policy – Kosovo
The IMF expects the average annual consumer price inflation in Kosovo to decrease to 2.1% in 2024, down from an average of 4.9% in 2023. Inflation is forecast to further ease to 2% in 2025.
Fitch said that Kosovo’s inflation, while moderating to 1.4% in August, still poses risks, with core inflation near 3.6%.
Fitch projects that inflation in Kosovo will average 2.1% in 2024-2025, hovering near the lower end of the 2-3% target range. As a euro-ised economy, an estimated 80% of Kosovo's inflation is imported. However, the country’s policy framework has yet to face a significant test against a strong, domestically-driven inflationary surge.
Inflation has eased significantly to 0.4% y/y in October 2024, mainly due to lower food and transport costs.
Kosovo's inflation rate averaged 2.62% from 2003 to 2024, peaking at an all-time high of 14.20% in May 2008 and hitting a record low of -4.40% in May 2009
4.6 Inflation & Monetary Policy – Moldova
Rising inflation may force Moldova's central bank to reconsider its
expansionary monetary policy.
Consumer price inflation accelerated to 5.4% y/y in November 2024 from 5.3% in October, reaching the maximum value over the past 12-month period compared to the 3.3% y/y minimum value in May.
The country's central bank reduced the monetary policy rate to 3.6% in May 2024, at the end of a tight monetary policy cycle aimed at fighting headline inflation rates as high as 35% y/y at the end of 2022 amid energy price hikes. The lower policy rates since May 2024 were explicitly aimed at stimulating economic growth, which remained subdued in 2024.
64 SE Outlook 2025 www.intellinews.com