At the same time, inflation will sharpen above the initially-forecast figures, while the budget deficit target will not be met. However, there is good news in connection with unemployment, which is expected to slide. The Austrian group’s report presents the new forecasts for the coming years and revised forecasts regarding the evolution of the Romanian economy in 2010.
According to the report, 2010 will end with a 4.5 percent inflation rate, compared to 3.1 percent previously estimated. This new estimate represents the ceiling of the inflation target set by the central bank, of 3.5 percent in 2010 (plus/minus one percentage point).
A significant improvement was made with respect to the unemployment rate. Erste revised its estimate regarding the jobless rate at the end of 2009 to 6.4 percent from 7.4 percent, and that at the end of 2010, to 8.2 percent from 9 percent. According to the National Prognosis Commission (CNP), the jobless rate will reach 7.6 percent at year-end, and 6.2 percent at the end of 2010.
After the elections, the pressures on the exchange rate could subside, and short-term interbank rates could return to a level close to the key rate. But this also depends on how fast a new government is formed, said an Erste report. Misu Negritoiu, ING Bank’s General Manager, said that the depreciation of the leu could also have positive effects, “such as the stimulation of production through the exchange rate policy.”
