ROBOR at three months up to 1.80pc. BNR keeps monetary policy rate at 1.75pc. Fin Min attends central bank’s Board sitting

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The Romanian Interbank Offered Rate (ROBOR) index at three months, used for variable-rate loans, has continued to hike on Tuesday to reach 1.8%, while 6-months ROBOR index has climbed to 1.89%, according to data released by the National Bank of Romania (BNR) on Tuesday.

On Tuesday, the BNR Board has discussed at the monetary policy sitting and a press conference with Governor Mugur Isarescu is expected later in the day.

“In its meeting of 3 October 2017, the Board of the National Bank of Romania decided the following: to keep unchanged the monetary policy rate at 1.75 percent per annum; to pursue adequate liquidity management in the banking system; and to narrow the symmetrical corridor of interest rates on the BNR’s standing facilities around the policy rate to ±1.25 percentage points from ±1.50 percentage points. Thus, starting October 4, 2017, the deposit facility rate rises to 0.50 percent per annum, while the interest rate on the BNR’s lending facility is lowered to an annual 3.00 percent,” a BNR release reads.

Finance Minister Ionut Misa has said on Tuesday, after a meeting with the BNR representatives, that the ROBOR increase is related to issues of market liquidity, given that the tax collection rate has increased and it’s the BNR job to find solution in order to ponder the ROBOR raise.

“I attended the sitting today, it was aimed at discussing technical issues on what is happening, on the ROBOR development, to envisage what is the best way in the future to connect the tax policy with the monetary policy to have better stability on the market, stability for the citizens, for those who have to pay interest instalments to the banks,” Finance Minister Ionut Misa said.

Referring to the ROBOR index, the minister said it is related to the market liquidity.

“It’s a matter of liquidity, there are several technical factors. The Finance Ministry’s tax collection, the collection rate is higher. It’s wrong to believe that if the collection rate increases, than the ROBOR index goes up. (…) There are means at BNR’s disposal to regulate the liquidity,” Minister Misa said, informs.

Misa added that there are conditions for the ROBOR index, the overnight interest is going down, the effects are positive.

He further said that each institution has its role, the Finance Ministry conducts tax policies and BNR coherent monetary policies – and then we will have stability.

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