• In line with expectations, consumer prices increased by 0.3% in February compared to January. In annual terms, inflation was steady at 1.1%, remaining outside the central bank's target range (+/- 1 percentage point around 2.5%) and we expect that it will stay here for the rest of the first quarter,  increasing gradually afterwards to 3.4%yoy by the end of the year.
• Industrial production registered a remarkable increase in January (10.1%yoy), supported by manufacturing sector (+12.4%yoy).
• The current account balance reached a surplus of almost EUR 0.4bn in January, 45% higher than in January 2013. The external demand from EU countries continued to improve; however, demand from non-EU countries deteriorated, with negative impact on exports.
• The year started negatively for construction, with activity falling in January by 4.3%mom and by 9.2%yoy.
• Supported by continuing improvement of money market liquidity, interest rates with maturities of up to three months continued to fall last week.
• In the context of thin interbank liquidity, the EUR/RON was pretty stable last week, trading in a range of around 4.4965 – 4.5150.
• After three quiet sessions at the beginning of last week, the EUR/USD reached a spike of 1.3967 on Thursday (the highest level of the last two years), mainly supported by the ECB decision not to ease further the monetary conditions.

Florentina Cozmâncă, Senior Economist
The Royal Bank of Scotland plc, Edinburgh, Romania Branch