The basic inflation will decrease until the end of this year, but will increase towards the forecasting period - 2022. The decline in the basic inflation is due to the disinflation pressure on the part of the internal aggregate demand. The subsequent trajectory of the basic inflation will be primarily influenced by the adjustment of excise duties in 2021 and 2022, says inflation report No. 4 presented by National Bank governor Octavian Armașu, IPN reports.
The governor noted that the annual pace of food prices will decrease insignificantly in the first half of the forecasting period and will rise in the second half. The diminution of the annual pace of food prices will be due to the internal aggregate disinflation demand and anticipated reduction in international food prices next year. The subsequent rise will be influenced by the effect of the seasonal products, recovery f aggregate demand and adjustment of excise duties.
The annual pace of fuel prices will follow an upward trend until the start of 2022, owing also to the rise in international oil prices and the adjustment of excise duties.
The report also says that the annual rate of inflation decreased to 2.3% in September 2020 owing to the COVID-19 restrictions, but the slip under the lower corridor level is temporary in character.
