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October 24, 2021

BNR could further cut monetary policy interest rate

The National Bank of Romania will further cut monetary policy interest rate but insignificantly, Central Bank official Lucian Croitoru says. “The National Bank will cut again the key interest rate in the coming period, but insignificantly. Those who expect major falls will be disappointed,” Croitoru told a seminar on economic issues, quoted by Mediafax. He mentioned that there is a very big demand from private circles to more drastically decrease monetary policy rate, as a result of the 7 per cent GDP contraction last year, and of inflation. “This is a good support for the people to request decrease of the interest rate,” Croitoru added. However, he reassured everyone his opinions are expressed in his own name, and do not represent BNR’s opinion. BNR Board resolved, in the February 6 session to cut monetary policy interest rate by 0.5 points, to 7 per cent, after it had been diminished by another 0.5 points in early January, from 8 per cent to 7.5 per cent. As for the Greek money situation Croitoru said it is rather improbable for the Greek parent banks to request Romanian subsidiaries to take money out of the country because of liquidity problems. This is mainly because they make profit on local market. Croitoru pointed out that 27 per cent of the banking system assets are held by banks from Greece.

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