National Bank of Romania

October 3, 2017

In seven equal increments, Romania’s central bank policy interest rate was halved to 1.75%, the current level, from 3.5% between August 2014 and May 2015. The latest policy review left that key benchmark at 1.75% but raised the standing overnight deposit rate to 0.5% from 0.25%. In conjunction with a decision to leave the standing lending rate at 3.0%, such narrowed and made symmetric the corridor of overnight rates that flank the policy interest rate.

In a released statement explaining the decision and laying out the backdrop of conditions that monetary officials perceive, note is made that monetary conditions in Romania remain “highly accommodative,” and the point is made that “The latest assessments reconfirm the outlook for a further increase in the annual inflation rate over the months ahead, yet at a slightly quicker pace than that in the medium-term forecast published in the August 2017 Inflation Report, against the background of some risks related to developments in certain exogenous CPI components materialising.”

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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