Romania’s Monetary Policy Rate Lowered Again

August 4, 2014

From 10.25% at end-2008, Romania’s central bank interest rate had been cut by 225 basis points in 2009, 175 bps in 2010, 25 basis point in 2011, 75 bps in 2012, 125 bps in 2013 and 50 bps in the first quarter of 2014.  That left the rate at 3.5%, where it stood for the past six months, but now it is being lowered again by a further 25 basis points to 3.25%, 7 whole percentage points below the pre-2009 high.  A statement released by the National Bank of Romania Board “shows the annual inflation rate remaining on a downward path and temporarily running below the lower bound of the variation band of the flat target. The new projected inflation path is significantly lower than that forecasted in May.”  Inflation is targeted between 1.5% and 3.5%.  On-year inflation fell from 1.55% at the end of 2013 to 0.66% in mid-2014.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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