The National Bank of Moldova (NBM) revised up the rate of inflation for this year. The new forecast is 5.4%, up 0.7 percentage points from the October projection, IPN reports.

“In the first two quarters of this year, we anticipate a slow rise in the general level of prices, mainly due to the contribution of food prices. In the second half of this year, inflation will start again to decrease,” NBM governor Dorin Dragutanu told a news conference.

The new forecast places inflation in the variation interval of ± 1.5 percentage points from the central bank’s target of 5% for the next eight quarters. In the last two years, the consumer price index was within this variation interval.

Dorin Dragutanu said the deflationist pressure will persist. The main deflation risks are related to the lower economic growth in the countries that are Moldova’s main commercial partners, the decreasing food prices on the world market and the possible toughing up of the migration and trade rules with Russia. The volume of remittances may decline and this will lead to the inhibition of internal demand.

In 2015 the inflation is forecast to stand at 4.8%, up 0.5 percentage points from the level projected earlier.