Romania slashes inflation forecast with VAT cut on horizon
Central bank cut key rate by 25bp earlier this week
The National Bank of Romania has slashed its forecast for inflation in 2015 as a result of the government's plans to cut VAT on all food items by 15% in June.
In its latest inflation report, released today (May 8), the central bank cuts its annual CPI forecast from 2.1% to 0.2% at the end of 2015, and from 2.4% to 1.9% at the end of 2016.
The central bank decided to cut its policy rate by 25 basis points to 1.75% on May 6, citing concerns over the risk of inflation remaining below target when
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