CFA Society Romania's Macroeconomic Confidence Index increased in December 2023 by 9 points, to 56.6 points.
According to a CFA Romania press statement released on Monday, the advance was due to an increase in both components of the indicator.
"High fiscal uncertainty as well as the anticipations of increasing taxation amidst a persistently high government deficit will lead to a significant slowing down of the disinflationary process. Thus, the participants in the survey anticipate a reduction in the inflation rate by less than one percentage point in the next 12 months," according to Adrian Codirlasu, deputy chairman of the CFA Society Romania.
The anticipated inflation rate for the 12-month horizon (January 2025) decreased from the previous year to an average of 5.78%, less than one percentage point lower than the December 2023 rate. Only 68% of the respondents anticipate a reduction in the inflation rate in the next 12 months as against 88% in the previous survey.
Regarding the EUR/RON exchange rate, over 71% of the respondents are expecting the local currency, the leu (RON), to depreciate in the next 12 months. Thus, the average value of the anticipations for the 6-month horizon is RON 5.0212 to the euro, while for the 12-month horizon, the average value of the anticipated exchange rate should be RON 5.0781 to the euro.
Regarding the developments in residential property prices in cities, 37% of the respondents are expecting a decrease in them, while 50% of them stability in the next 12 months. Also, 71% of the respondents consider that the current prices are overvalued, while 29% consider that they are correctly valued.
The government deficit for 2023 is anticipated at 5.8% of GDP, and at 5.6% for 2024.
For 2023, the anticipated value of real GDP growth was 2%, and for the year 2024, the anticipated economic growth is 2.6%. Public debt calculated as a percentage of GDP is expected to increase to 54% in the next 12 months.
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