Romania: Annual consumer prices drop to a new all-time low in April
April 11, 2016
In April, consumer prices dropped 0.2% over the previous month, which contrasted the 0.1% increase tallied in March and marked the third price decrease since the start of this year. March’s result mainly reflected lower prices for goods and food products, which more than offset a rise in prices for services. Consumer prices had been following a downward trajectory since June, mainly resulting from the reduction of the value added tax (VAT) for food items and beverages since June and a cut in the general value-added-tax (VAT) that has kept inflationary pressures muted.
In annual terms, consumer prices recorded a sharp 3.3% drop in April, which marked the largest fall on record (March: -3.0% year-on-year). As a result, inflation moved further below the Central Bank’s tolerance margin of plus/minus 1.0% around its 2.5% target. On average, consumer prices fell 1.7% in annual terms in April (March: -1.4% yoy), marking yet another record low.