Economic adjustment must create the conditions for restoring confidence and achieving healthy growth, while an economy does not restart through laws, ordinances or public statements, but when people and businesses once again begin to have confidence in tomorrow, interim Finance Minister Alexandru Nazare believes.

According to him, August saw the fastest slowdown in inflation in recent years, and this is the result of a genuine correction of the economic imbalances.

'Just over a year ago, in June 2025, I took over the Ministry of Finance at a time when Romania no longer had the luxury of postponing decisions. The very high deficit, the huge financing requirement and persistent inflation were feeding into one another. Every month without decisions meant more debt, higher interest rates and less room for development. The government led by Ilie Bolojan took on a difficult but necessary fiscal correction. The responsibility of the Ministry of Finance was to turn this direction into a realistic budget, controlled execution on a day-to-day basis and prudent management of state financing. Our objective was for fiscal policy to stop amplifying inflation and imbalances through ever-larger deficits and instead become an anchor of stability. The first results are now visible in the economic data. The annual inflation rate fell to 6.2% in August, from 8.2% in July and above 10% in June. This is the fastest deceleration in recent years and, unlike previous episodes, it is not the result of an administrative price cap, but of a genuine correction of the economy's imbalances,' Nazare wrote on his Facebook page on Monday evening.

He stressed that part of the decline can be explained statistically, by the fact that last summer's price increases have now dropped out of the calculation. At the same time, the other part is related to fundamentals, namely subdued domestic demand, a declining deficit and lower financing costs.

The minister also said that the August data provide a number of indicators that need to be analysed carefully: excluding fuel, consumer prices fell by 0.08% in August compared with the previous month. Food prices fell by 0.7% in a single month, while vegetables and fruit are cheaper than they were a year ago.

'The remaining pressure comes almost entirely from the external oil market: petrol and diesel are the only categories showing double-digit increases. This is a factor we do not control, although its effects can be absorbed - and an economy's ability to absorb them depends on how sound its internal fundamentals are. This was the purpose of the adjustment launched last summer. I took over a budget built on a model that could no longer be sustained. In the first seven months of this year, the budget deficit is 37% lower than in the same period last year, while public investment has increased by 15 billion lei. We have reduced the imbalance without stopping construction projects. These results matter not only in economic statistics, but also in people's everyday lives,' Nazare said.

He noted that almost half of this year's deficit, approximately 3% of GDP, consists solely of interest payments on debt accumulated in previous years, and that this is money that goes neither to hospitals, nor schools, nor motorways.

Nevertheless, he warned, inflation at 6.2% is still high, and the decline in August does not mean that prices have returned to their previous levels, but rather that the rate at which they are increasing has slowed.

'Average inflation over the past 12 months is almost 9.5%, and this is reflected in bills and on shop shelves. The recovery of real incomes comes later than the statistics, and for most people the past year has been difficult. We know this very well and, therefore, correcting public finances remains a priority,' Alexandru Nazare said.

The interim minister also stressed that disinflation is good news for purchasing power: the more slowly prices rise, the more purchasing power salaries and pensions retain. In this way, healthy domestic demand can be rebuilt through real incomes that are beginning to regain their value, rather than through deficits and increasingly expensive borrowing, as in the past.

'We now have an opportunity that we have not had for a long time: to turn a difficult year into an opportunity for a fresh start - energy, industry, infrastructure, European funds used down to the last euro, Romanian capital that stays at home. The journey is not over and it will not be easy. But, for the first time in a long while, the direction is the right one,' Alexandru Nazare stressed. AGERPRES (RO - writing by: Nicoleta Gherasi; EN - writing by: Cristina Zaharia)