Headline consumer price inflation rose to 4.7% y/y in February, up from 4.3% in January and the highest since June 2013. While food price inflation edged down to 3.7% y/y (from 3.8% in January), prices rose stronger for non-food products (6.3% y/y, after 6.2% in January) and for services (2.9%, up from 0.9%). The continued surge in prices will further stoke overheating concerns. Real GDP soared by +7% in 2017, largely driven by a +10.2% rise in consumer spending. And the latter was boosted by strong pro-cyclical fiscal stimulus and a +13% increase in nominal wages, which was well above productivity gains. Since headline inflation has now clearly exceeded the 2.5% ± 1pp target range of the National Bank of Romania (NBR; the central bank) for two months in a row, despite two policy interest rate increases by 25bp each in January and February, we expect further, perhaps more aggressive rate hikes in the next months. The next regular monetary policy meeting is scheduled for 4 April.