Romania: Selected Issues

International Monetary Fund

No 2016/114, IMF Staff Country Reports from International Monetary Fund

Abstract: This paper discusses the following important issues related to the Romanian economy: inflation and inflation expectations, the need to bolster expenditure efficiency, minimum wage policy, and financial sector development. Headline inflation has decreased markedly in Romania in recent years. Key factors in this trend were oil and food price developments and, in particular, the recent reduction in the VAT rate. Romania has undertaken a strong fiscal consolidation since 2010, which reduced expenditure to among the lowest in the region. Minimum wages in Romania have risen sharply, which could directly affect wage distribution and improve income inequality.

Keywords: ISCR; CR; inflation expectation; wage; minimum wage; headline inflation; wage distribution; wage bill; credit growth; consolidation measure; Minimum wages; Inflation; Wage adjustments; Wages; Credit; Global; Eastern Europe; Southern Europe; Europe (search for similar items in EconPapers)
Pages: 62
Date: 2016-05-11
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