Page 69 - bne IntelliNews Southeastern Europe Outlook 2025

The National Bank of Romania (BNR), which cut the monetary policy rate by 50 basis points (bp) in July-August, revised upward the inflation projection for the end of 2024 to 4.9% in its updated November Inflation Report, from its previous forecast of 4.0%.
The inflation projection for the end of 2025 was raised to 3.5% from the previous 3.4%.
The central bank added that the projected inflation trajectory doesn't include the effects of the fiscal and budgetary correction that the government will carry out at the beginning of 2025.
The balance of risks to the future evolution of the annual inflation rate is assessed to remain tilted to the upside, the report reads. The baseline scenario is built on the principle that fiscal measures are included in it only after their enactment into law or at least once they are due for enactment.
The monetary policy rate, at 6.5% at this moment, will be cut “when the inflation is decreasing “in a sustainable manner”, central bank governor Mugur Isarescu said. In the short term, the inflation is expected to rise, driven by food prices, as the effects of the adverse weather are more visible in Romania compared to other countries in Europe, he added.
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