The National Bank of Romania (BNR) is holding a press conference on Thursday, led by Governor Mugur Isarescu, to present its quarterly Inflation Report.

According to a BNR release, the annual inflation rate will see a substantial downward correction in Q3 of 2026 as the direct effects of the removal of the electricity price cap and increases in VAT rates and excise duties fade.

'In today's meeting [Monday], the BNR Board examined and approved the August 2026 Inflation Report, which incorporates the latest available data and information. According to the forecast in the Report, the annual inflation rate will see a substantial downward correction in 2026 Q3, as previously anticipated, once the direct effects from the expiry of the electricity price capping scheme and the increases in VAT rates and excise duties have faded away. Moreover, after slightly fluctuating in 2026 Q4, it is expected to gradually decrease, re-entering the variation band of the target at end-2027, under the impact of disinflationary base effects associated with the recent price hikes induced by the energy shock, as well as amid the strengthening of underlying disinflationary pressures, especially those from the aggregate demand deficit; the latter will further widen over the near term, falling to lower-than-previously-envisaged levels - given the budgetary correction, but also the global energy crisis - and will progressively narrow thereafter,' according to the release.

The BNR raised its inflation forecast for the end of 2026 to 5.5%, from 3.9% previously, and expects inflation to reach 2.9% by the end of 2027, according to data presented in May by Governor Mugur Isarescu. AGERPRES (RO - writing by: George Banciulea; EN - writing by: Rodica State)