Romania Special | Inflation drivers: tradable vs. non-tradable prices
We take another look at inflation by breaking it down into tradable and non-tradable components. Such data dissemination analysis is new to Romania. We created indexes for tradable and non-tradable consumer prices based on Dwyer work. We found out that tradable goods inflation has been the main factor behind the increase in consumer prices so far, but it continued to decelerate, after reaching a peak one year ago. Non-tradable prices, mainly services, are driven by the wage inflation pass-through. In our view, the elevated wage-sensitive services inflation could weigh on NBR decision-making.
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