National Bank of Romania

July 1, 2015

Romania’s policy interest rate, which had been cut four times in the first half of 2015 by 25 basis points each to a record low now of 1.75%, was not changed after the latest Board meeting.  While a released statement said officials expect inflation to run below the 1.5-3.5% target, other considerations argued for caution:  “the situation in Greece, uncertainty surrounding Romania‚Äôs agreements with international institutions and the divergence between the monetary policy stances of major central banks worldwide, call for a prudent reconsideration of the monetary policy cycle.”

Altogether, the policy rate has fallen 850 basis points since end-2008 when such was at 10.25%.  Officials also left reserve requirements unchanged after today’s meeting.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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