Romania’s National Bank (BNR) has provided consistent liquidity to the banking system over the past month and a half.
As a result, the State Treasury has successfully raised RON 11 billion (EUR 2.26 bln) from April 1 to May 15, BNR governor Mugur Isarescu said in a press statement.
BNR has intervened by intensifying the repo-type operations to a daily average of RON 13 bln (EUR 2.7 bln) in April and the first half of May from RON 3 bln (EUR 620 mln) in February, and by directly purchasing government papers worth RON 3.1 bln (EUR 640 mln).
Another effect of BNR’s operations was the decline in the reference rates on the secondary market for government securities. Thus, looking at maturities of up to 1 year, they have recently returned to the vicinity of the values recorded before the outbreak of the global financial market turmoil.
The immediate objective of BNR is to further provide the necessary liquidity for financing the budget expenditures and the real economy, amid the relative stability of the RON’s exchange rate and the gradual and sustainable cut in interest rates, Isarescu added.
“We have found solutions for each problem,” namely financing the public deficit and encouraging the economy, president...