Effective 12% decrease in bread price

Romania's National Statistics Office INS announced a 12 percent decrease in the price of bread and that turned out to be very effective in VAT reduction for bakery products, according to Romanian prime-minister Victor Ponta.

The prime-minister also stated that if the VAT cut is also efficient regarding reduction in tax evasion, the system could be expanded starting with 2014.

Romanian authorities decided to lower VAT for bread in September this year. The new one is 9 percent, down from the previous 24 percent.

According to data provided by the INS for November this year, consumer prices were kept steady from the previous month, while prices of food dropped 0.2 percent. Meanwhile, the annual inflation rate was 1.83 percent.

The most important decrease in food was recorded for fruits and canned fruits, a decrease of 4 per cent. The prices of non-food items and services tariffs went up 0.1 per cent every month.

Romania's Central Bank BNR has revised down its inflation forecast for this year, from 3.1 percent to 1.8 percent and also for the end of 2014 – from 3.1 percent to 3 percent.