Another Romanian Interest Rate Cut

March 29, 2012

Romania’s monetary policy rate has been reduced to 5.25% from 5.5%.  This move by the National Bank of Romania was not a big surprise and follows similar 25-bp cuts announced November 2, January 5, and February 2. CPI inflation subsided to 2.6% in February from 3.1% in December and 8.0% at end-2010.  Weak growth in Europe is another concern.  In all, there have been 13 rate reductions uninterrupted by an increase — five in 2009 totaling 225 bps, four in 2010 adding up to 175 bps, and the aforementioned four cuts of 25 bps each during the past five months.  Officials did not change reserve requirements at this time.

Copyright 2012, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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