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Romania central bank leaves interest rates unchanged

MNB

Photo by Radu Bercan/Shutterstock.com

Romania’s central bank left its key interest rate unchanged, as had been predicted by market analysts. The National Bank of Romania (BNR) decide to keep the monetary policy rate at 2.5%, the bank said in a statement on on Wednesday.

Photo by Radu Bercan/Shutterstock.com

The policy rate has been at the current level since May 2018, when it was raised by 25 basis points. The deposit facility rate was left unchanged at 1.5% and the lending facility rate was kept at 3.5%. Policymakers also decided to maintain the existing levels of minimum reserve requirement ratios, the Bucharest-based BNR said.

Romanian inflation will stay slightly above target this year before falling to its upper range in 2020, but the central bank’s benchmark interest rate will remain negative, BNR Governor Mugur Isărescu said.

The bank has said a widening current account deficit was worrying, and a stronger leu (the Romanian currency) would not help. Inflation slowed to 3.5% on the year in September, at the upper end of the bank’s 1.5-3.5% target, BNR said.

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