The Romanian Central Bank (BNR) has revised the inflation forecast for this year from 5.1 percent to 4.6 percent, and the 2012 forecast from 3.6 percent to 3.5 percent, according to the central bank's governor, Mugur Isarescu. He showed that starting from May and June there was an "extremely strong" correction in volatile prices, and the persistent demand deficit helps to reduce inflation.

In May, the central bank raised the inflation forecast for this year from 3.6 percent to 5.1 percent, and that of next year from 3.2 percent to 3.6 percent.

Last week the Romanian National Bank’s Board of Directors decided to keep the key interest rate at 6.25 percent per year, as expected by analysts, and also to maintain the current levels of mandatory reserve, both in RON and in foreign currency.

Irina Popescu, irina.popescu@romania-insider.com