Escape clauses define ex ante a narrow set of circumstances that are beyond the control of monetary policy and therefore circumscribe the responsibility of the National Bank of Romania for achieving the announced inflation targets.

These circumstances include:

• major hikes in world prices of raw materials, energy-producing materials and other commodities;
• natural disasters and other exceptional events that induce either supply (in terms of costs) or demand side impact on prices, as well as unpredictable changes in agricultural producer prices;
• large fluctuations of the exchange rate of the leu that are decoupled from domestic economic fundamentals as well as from the monetary policy pursued by the National Bank of Romania;
• major deviations from the administered price adjustment program announced by the Government, in terms of both magnitude and timing;
• divergence from the programmed fiscal and incomes policies, in terms of both implementation and final results.

Since the proper recourse to escape clauses constitutes a prerequisite for the central bank's credibility, they are to be put forward with utmost caution, and only for well justified reasons.

Circumscribing the central bank's responsibility for attaining the inflation target contingent upon escape clauses helps to properly set the targets and thus to project the disinflation path, as well as to analyze the actual inflation outcomes relative to the target band.