In November, Romania recorded a 0.4% MoM increase in CPI, with annual inflation holding steady at 9.8%, while HICP reached 8.6%. This reflects Romania’s ongoing battle with elevated price pressures driven by fiscal adjustments and the removal of energy subsidies. Meanwhile, average net earnings increased 0.9% in October compared to September, but 4.3% annual nominal wage growth has failed to keep pace with inflation, resulting in significant erosion of purchasing power amid a challenging macroeconomic environment marked by near-stagnant growth and aggressive fiscal consolidation.
Compared to October, November saw another increase in consumer prices, with the CPI rising 0.42%. On an annual basis, inflation remained at 9.8%, unchanged from the previous month but reflecting continued elevated price pressures. Additionally, the 12-month average inflation rate stood at 6.9%, up from 6.6% in October, reflecting the continued shift from base-effect-driven disinflation to structurally higher price growth.
Romanian CPI YoY growth rate (January 2019 – November 2025, %)
Source: Romanian National Institute of Statistics, InterCapital Research
Breaking down the data by category, services registered the highest annual increase at 11.0%, followed by non-food goods at 10.7%, and food goods at 7.6%. On a monthly basis, services prices rose by 0.71%, non-food goods by 0.41%, while food prices increased more moderately by 0.25%.
The persistence of high inflation is primarily attributable to three key factors. First, the removal of electricity price caps in July 2025 introduced a significant one-off shock, with electricity prices surging approximately 60% YoY. This measure, initially designed to align domestic energy prices with market realities and reduce fiscal strain, generated substantial pass-through effects into the broader price index. Second, the VAT increase and excise tax adjustments implemented as part of Romania’s fiscal consolidation package added additional inflationary pressure. These tax measures were enacted to address Europe’s largest budget deficit (9.3% of GDP in 2024) and comply with EU Excessive Deficit Procedure requirements. Third, the political uncertainty surrounding the annulled November 2024 presidential election and subsequent May 2025 election created fiscal policy unpredictability, which likely contributed to pre-emptive pricing behavior by businesses anticipating further fiscal tightening.
HICP YoY change for selected EU countries (November 2025, %)
Source: Eurostat, InterCapital Research
Turning to the Harmonized Index of Consumer Prices (HICP), used for cross-country comparisons within the EU, Romania posted a 0.49% monthly increase and an annual rate of 8.6% in November 2025. This keeps Romania well above Euroarea inflation levels (although Romania has its own currency), underscoring that the current inflation episode is increasingly domestically generated, driven by aforementioned fiscal adjustment measures and structural vulnerabilities.
The Romanian National bank has maintained its policy rate at 6.5% throughout 2025, balancing inflation risks against fragile economic growth. The latest CB’s inflation projections states that inflation will remain above its target band (2.5% ± 1pp) until 2027, reaching approximately 3.7% by end-2026. Therefore, risks remain tilted to the upside, particularly with the scheduled removal of natural gas price caps in March 2026, which are expected to add further inflationary pressure.
Regarding wages, the average net earnings in October 2025 stood at RON 5,492, reflecting a 0.9% increase compared to September. On a gross basis, earnings reached RON 9,1512, up 0.8% MoM. However, when adjusted for inflation, the real earnings decreased 5.0% compared to October 2024, indicating that wage growth has failed to keep pace with price increases, resulting in eroded purchasing power for Romanians.
Evolution of net average earnings (October 2024 – October 2025, RON)
Source: Romanian National Institute of Statistics, InterCapital Research
For the economic sector, industries leading the growth of net earnings included manufacture of computer, electronic and optical products (+12.9% MoM), real estate activities, printing and reproduction of recorded material, and financial services. These increases were driven by the granting of occasional bonuses, payments in kind, and profit distributions. Conversely, significant decreases were recorded in activities auxiliary to financial services and insurance (-14.2%), extraction of crude petroleum and natural gas (-13.9%), and mining support services. These declines resulted from the timing of bonus payments concentrated in earlier months, lower production achievements, and reduced receipts depending on contracts and projects.
As for the budgetary sector, average net earnings increased compared to the previous month in education (+2.4%, due to resumption of hourly payments for teaching staff after the summer break) and public administration (+0.8%). A modest increase was also recorded in human health and social work activities (+0.2%). These developments occur against a backdrop of aggressive fiscal consolidation, with the government implementing a freeze on public sector wages and pensions at November 2024 levels as part of an omnibus decree aimed at cutting potential expenditures by 133 billion lei.
To sum up, compared to early 2025, the inflation narrative has shifted decisively. What was previously a gradual disinflation story supported by base effects and energy caps has now become a re-acceleration phase driven by policy normalization, fiscal-electoral dynamics, and persistent wage growth. This materially complicates the inflation outlook and suggests that inflation risks in Romania remain structurally skewed to the upside.
For a more detailed analysis of macroeconomic developments in Romania and other selected CEE markets, refer to our latest IC Macro Outlook, prepared by our Proprietary Trading team.