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February 2, 2023

BNR Governor: Romania has fulfilled the five Maastricht criteria for Euro Area accession

“Nobody believes us! This means we had ups and downs in our past and it is normal to have credibility issues”

The National Bank of Romania (BNR) Governor is confirming what Nine O’Clock has also been saying: the RON is indifferent to turbulences on the political scene. Or, as the BNR Governor puts it: “the lion sprawls, waving his tail from time to time.”
The exchange rate’s influence on prices has significantly diminished in recent years and for at least the past six months the lion “has sprawled in the RON 4.40-4.44/EUR interval,” and has become “completely indifferent to political statements,” even in an elections year, this after the RON’s depreciation used to have a double impact on the evolution of prices several years ago, Mugur Isarescu stated on Wednesday at the Monetary Policy Colloquies.
He pointed out that the reduction of the asymmetry between the impact on prices had by RON’s devaluation and appreciation was noted following profound research conducted by the National Bank’s monetary policy team.
In the BNR Governor’s opinion, it is important for the Central Bank to offer more transparency, to prove that its methods are based on research, in order to raise credibility, bearing in mind the fact that although Romania is fulfilling all criteria for the adoption of the EUR currency “nobody believes us.”
“We are experiencing this strange feeling that of the five countries we have ended up being the only country that fulfills all five Maastricht criteria for Euro Area accession. In what concerns the score with 12 indicators, we are overtaking only in the case of the net investment position, but that’s what all countries are doing, because the paradigm has shifted: before it was good to have capital inflows, and now if they are too large… And look, nobody believes us! This means we had ups and downs in our past and it is normal to have credibility issues,” the BNR Governor explained. Romania has set 1 January 2019 as its target for Euro Area accession, the initial target having first been 2015.

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