UPDATE BNR keeps monetary policy on hold

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The Board of the National Bank of Romania (BNR) decided to keep unchanged the monetary policy rate at 1.75 percent per annum and to pursue adequate liquidity management in the banking system, a press release informs on Friday.

At the same time, the central bank decided to maintain the existing levels of minimum reserve requirement ratios on both leu- and foreign currency-denominated liabilities of credit institutions.

“The decisions aim to ensure and preserve price stability over the medium term in a manner conducive to achieving sustainable economic growth. The BNR Board reiterates that a balanced macroeconomic policy mix and progress in structural reforms are of the essence in preserving a stable macroeconomic framework and strengthening the capacity of the Romanian economy to withstand potential adverse global developments.

BNR is closely monitoring domestic and external developments and stands ready to use all its available tools,” the financial institution notes.

The central bank last changed the key interest rate in May 2015, when it cut it by 25 basis points.

In its inflation report issued in May, Romania’s central bank lowered its 2017 inflation forecast to 1.6 percent from previously projected 1.7 percent, adding that a downward revision of inflation projection could delay a hike of its key rate planned for 2018.

BNR also lowered its end-2018 inflation forecast to 3.1 percent from a 3.4 percent projected in February.


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