Romanian central bank: no more rate cuts and looser inflation targeting
"We do not see any reason for further cuts of the policy rate, and we are ready to ensure the flexibility of our inflation targets having in mind the pretty elevated debt levels," Romania's National Bank (BNR) governor Mugur Isarescu said…
iulian ernst · Journalist
· Updated · 1 min read
"We do not see any reason for further cuts of the policy rate, and we are ready to ensure the flexibility of our inflation targets having in mind the pretty elevated debt levels," Romania's National Bank (BNR) governor Mugur Isarescu said at a conference organized by the International Monetary Fund (IMF).
BNR has reduced its monetary policy rate from 2.5% in March 2020 to 1.25% today.
As the monetary measures taken have been appropriate, the interest rates are now at historically low levels, and there was no need to flood the market with liquidity, Isarescu argued.
Concerning the exchange rate, BNR is ready to ensure more flexibility having in mind its role as anchor of social trust in Romania, the governor said.
His speech comes days after the March inflation showed prices slipped above the central bank's projections: CPI inflation eased compared to February, to 3.95%, yet above BNR's 2.9% projection. Furthermore, the CORE inflation was estimated by ING Bank's analysts at 4% [year-on-year] way above BNR's 2.8% estimate.
(Photo source: Bnr.ro)
