“A good agricultural year means another EUR1 billion, equal to almost one percentage point of the gross domestic product,” Isarescu said at the central bank’s presentation of the quarterly inflation report.
Romanian authorities forecast an economic growth of 1.5% this year, from a contraction of 1.3% in 2010.
According to the MARS Bulletin drafted by the European Commission’s Joint Research Centre, Romania’s yield per hectare is above the average in the last five years for most crops, and the wheat, barley and potato harvests exceed last year’s yield.
Isarescu said recently the annual inflation could also benefit from good farm output and ease to below 4% in September, from 7.9% in June.
The central bank targets an annual inflation of 3% at the end of 2011, plus/minus one percentage point around the band.
Monday, the bank revised down its forecast on the year-end inflation to 4.6% from 5.1%, citing improved economic outlook and falling prices.