CPI inflation in Moldova hits 33.6% y/y in July

CPI inflation in Moldova hits 33.6% y/y in July
/ bne IntelliNews
By bne IntelliNews August 11, 2022

Consumer prices in Moldova increased by 1.4% in July, the slowest rate in the past year, but the annual inflation rate edged up to 33.6% y/y from 31.8% y/y in June, the statistics bureau announced.

Food prices increased by 36.4% y/y as of July, the prices of non-food goods by 24.1% y/y and the prices of services (which include natural gas and electricity) by 43.5% y/y.

In particular, the price of natural gas quadrupled compared to July 2021 and the price of electricity increased by 59%. The prices of hot water and heating increased by 80-90% y/y.

Further hikes of the end-user electricity price are likely, given the current wholesale prices, while Moldovagaz claims that it cannot pay its bills to Gazprom without further hiking the end-user prices charged.

Under the revised Inflation Outlook published on August 10, the National Bank of Moldova (BNM) forecasts the annual inflation rate to peak at 34.7% y/y in Q3 and ease afterwards.

Compared to its previous scenario, the BNM revised upwards the inflation forecast for the coming three quarters (until Q1 2023) and downwards after that. Annual inflation is expected at 6.5% y/y in Q2 2024.