BNR bought Govt. bonds worth only 0.4% of GDP - significantly less than peers in Hungary, Poland

The National Bank of Romania (BNR) bought Government securities to a very small extent, in contrast to other central banks in the region, and not for quantitative easing purposes, claims Cristian Popa, member of the BNR Board.

The purchases of government securities made by the Romanian central bank accounted for 0.4% of GDP in 2021.

By comparison, the National Bank of Poland bought the equivalent of 5.5% of GDP, the National Bank of Hungary 6.9% of GDP, while the European Central Bank bought assets of more than 40% of the GDP of the eurozone, Popa argues in a recent note, Ziarul Financiar reported.

In April 2020, the BNR began, for the first time, to buy Government securities on the secondary market, facilitating the financing of the budget. Such operations were carried out after the BNR became a net creditor in the relationship with commercial banks.

The BNR claimed that it decided to buy government securities in local currency (lei) from the secondary market in order to strengthen the structural liquidity in the banking system that would contribute to the financing of the real economy and the public sector in good conditions.

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