We must continue to take care of vulnerable people and, above all, we must consider what could happen this winter as the European economy has cooled, Finance Minister Adrian Cachiu said after the law was passed. the first budget correction in 2022.
“There is pressure for an economic slowdown, which we are looking at. Therefore, the most important thing is to restore delays in the investment sphere. This is an approach that should involve the whole of government as well as local authorities. This area can bring us to the perimeter of the balance sheet and keeping certain situations under control, taking into account the investment multiplier factor,” Cachiu said.
According to him, “it is very important that when the inflationary proxy that is born (inflation does not appear suddenly) you take action then, because once the roller coaster of inflation starts and starts, it will be very difficult to stop. or change the trend.”
BNR and pro-cyclical actions, according to Kachiu
“Previous governments should have taken into account the fact that it will be difficult for us to stop inflation,” says the finance minister.
On the other hand, he says, the NBR is trying to act through monetary policy, but the action in an inflationary situation is somewhat pro-cyclical because you already have a weight with inflation that translates into high and buoyant interest rates as the monetary policy rate rises.
“In the same way, the state has to be careful how it acts, because we also, because of the measures that we have to take for the benefit of the economy and the citizens, have to be careful that this pro-cyclical attitude does not somehow have a negative effect. later,” Adrian Cachiu clarified.
- We managed to stabilize the inflation zone. I want to see when this trend changes.
“Our combined efforts – the NBR and the Government – must reverse this inflationary trend. It’s not going to be a fabulous drop when the trend reverses because you have to keep in mind that we have a very large trade deficit and some imported inflation. We also have such a problem with energy, which now has a very strong impact on inflation,” the Minister of Finance also noted.
Source: Hot News RO
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