Thursday, November 10, 2011

Romanian October Inflation Rate Unexpectedly Rises on Heating

Romania’s inflation rate unexpectedly rose in October for the first time in five months because of higher heating bills after the government cut subsidies to meet pledges to international lenders.

The annual rate advanced to 3.55 percent from 3.45 percent in September, the National Statistics Institute in Bucharest said today in an e-mailed statement. The median estimate of nine economists surveyed by Bloomberg was for a 3.2 percent rate. Prices grew 0.6 percent on the month.

Romania’s inflation, which has slowed more than forecasts since July, prompted the central bank to lower its main interest rate on Nov. 2 to aid an economic recovery. The rate, which will probably end 2011 at 3.3 percent, leave policy makers with more room to reduce borrowing costs, Governor Mugur Isarescu said on Nov. 7.

Non-food costs advanced to 5 percent from a year earlier in October from 4.8 percent in September, mainly driven by surging heating and fuel prices, according to the institute. Food prices grew 1.7 percent in October, matching the September growth pace, while services prices growth accelerated to 3.6 percent from 3.5 percent the previous month, the institute said.

To contact the reporter on this story: Irina Savu in Bucharest at isavu@bloomberg.net.

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