Isărescu on inflation: “It will increase by July. It will probably go up to 11%”

NBR estimates a new increase in inflation by July

The Governor of the National Bank of Romania, Mugur Isărescu, warned that inflation could continue to increase in the coming months, amid the effects caused by the Middle East crisis on the oil and gas markets. He spoke about the impact of the “Ormuz inflation”, which amplified the pressures on prices and modified the trajectory previously estimated by the central bank.

According to Isărescu, the NBR sees „slight inflationary pressures”, amplified in recent times, but the governor stressed that the evolution must be viewed in the context of the expected decrease in inflation compared to the very high levels previously reached.

„It will increase until July. We don’t know exactly either, there are many factors. It will probably go up to 11%”, said Mugur Isărescu, specifying that, subsequently, inflation would decline rapidly.

NBR forecast: inflation of around 5.5% at the end of the year

The NBR governor explained that, according to current projections, inflation could reach 6% in September, and at the end of the year it could be around 5.5%, depending on external and internal developments.

“Towards the end of the year, 5% or so,” said Isărescu, adding that the forecast is strictly conditioned by the assumptions regarding the conflict in the Middle East and the return to a minimum of political and governmental stability.

For the end of next year, the BNR estimates an inflation of 2.9%, and in 2027 a return to the central bank’s target range, but the governor insisted that this scenario depends on factors that Romania does not fully control.

Isărescu: “We need a government. Clearly”

Mugur Isărescu rejected the idea that he was optimistic, but said that he was trying to convey a realistic and positive message, in a context in which economic and political tensions can amplify negative perceptions.

“No, I am not,” said the governor, when asked if he was optimistic. He explained that things were still “controllable,” but that Romania needed political stability.

„But we need a government. Clearly. We can’t do it alone,” said Isărescu, emphasizing that there are many factors that cannot be controlled by the central bank.