Romania's National Bank (BNR) has failed to purchase enough Government debt and has kept the monetary policy rate at high levels, finance minister Florin Citu said, criticizing the monetary authority for insufficient support, Hotnews.ro reported.

The fiscal policy has done most of the work so far, indeed helped by the monetary policy - "but if we look in detail, the central bank has not reached its target for the purchase of government securities on the secondary market."

Citu also stated that the monetary policy interest rate is still high. "Romania still has room to reach zero or even negative (interest rates)," he said.

In the meantime, BNR's financial stability director Eugen Radulescu explained, not necessarily as a response to Citu, that the Government could not efficiently address the crisis because of the pro-cyclical policies pursued in previous years, Profit.ro reported. While not blaming the Government directly for lack of supportive policies, Radulescu still implies that the stimuli provided by the Government can't be strong enough because of the past policies that narrowed its room for maneuver.

"Unfortunately, the errors of 2008 have repeated, from my point of view, on a much larger scale since 2017. This resulted in the Government's limited capacity to support the private sector, among others," said Radulescu.

andrei@romania-insider.com

(Photo source: Inquam Photos/Octav Ganea)