Romanian inflation falls to 8.2% YoY in July, but rate cuts are not expected before early 2027 due to persistent price pressures.
Romanian headline inflation eased to 8.2% year-over-year in July, the lowest since mid-2025, driven primarily by base effects. However, month-on-month momentum shows no clear slowdown, keeping the National Bank of Romania on hold until at least early 2027.
Across Central and Eastern Europe, markets remain hawkish after a sharp sell-off in rates linked to US-Iran tensions. Nearly three rate hikes are priced in for the Czech Republic and two for Poland, though strategists see the moves as overdone. The Czech Koruna and Polish Zloty may recover, while the Hungarian Forint faces pressure from energy supply concerns.
Higher yields in the region are expected to provide support for currencies, offsetting some of the recent volatility. Geopolitical developments and a quiet economic calendar leave markets focused on external risks.