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BNR conducts the largest repo operation to halt ROBOR increase

The National Bank of Romania (BNR) has conducted on Monday the eighth repo operation this year, and the largest in the past 17 years: RON 16.65 billion.

Previously, the largest repo operation was of 13.85 billion, dated on June 25, 2012, with an interest rate of 5.25%, due in 7 days.

According to sources, the economists have expected the repo operation, a reversible liquidity injection transaction, by which the BNR buys from credit institutions, eligible for trading, with their commitment to redeem those assets at a later date and at a price set at the transaction date.

At the end of each month, liquidity on the interbank market falls due to the fact that banks are required to build their minimum reserves and the taxpayers have to pay taxes and duties. The trend is increasing at the beginning of each quarter, as is the month of October.

The results of the Monday operation were reflected on the market. The 3-month ROBOR index has decreased to 3.34% on Monday, down from 3.38% on Friday.

About Valeriu Lazar