Isarescu on relationship between BNR and Gov’t: I can assure you we never scuffled. It was rather a media war

Harmonising the Government’s policies with the National Bank of Romania (BNR) policies is a complex process, central bank Governor Mugur Isarescu stated at a press conference on Monday. on Monday.

“In essence, harmonisation sounds good, the Government’s policies are being harmonised with those of the National Bank, it’s a process. I can assure you we never scuffled. It was rather a media war,” Isarescu stated.

The Governor considers that talks between the BNR and Government representatives are normal.

“They are saying what the popular vote wants, we are saying what the economy wants. Do you think it’s so easy to reconcile these things? (…) We are working with the markets, they are working more with opinion polls,” Isarescu stated.

The Governor pointed out that during the almost 28 years he has spent at the helm of the BNR there were more difficult moments in what concerns harmonising the policies of the two institutions.

He said that the war between the National Bank of Romania and the Government, against the backdrop of the talks with PSD President Liviu Dragnea, was rather a media war, and the two sides “never scuffled,” BNR Governor Mugur Isarescu stated.

Liviu Dragnea, Premier Viorica Dancila, Finance Minister Eugen Teodorovici, and Premier’s advisor Darius Valcov, met BNR Governor Mugur Isarescu last Thursday, the agenda of their talks including topics such as the Robor and inflation rate hikes.

After the talks, Dragnea pointed out that PSD does not want to take over the BNR, contrary to the public statements made “by some persons holding very high offices,” referring to President Klaus Iohannis who had stated that “BNR cannot be politically seized by the PSD and must remain independent, in order to implement an independent policy in the interest of Romania.”

On Monday, the BNR announced it hiked the key interest rate from 2.25 to 2.5 percent per year.

On Friday, the 3-month Robor index on whose basis the interest rates for most RON-denominated loans are calculated, rose to 2.54 percent, the highest level since 20 October 2014, back when it stood at 2.62 percent.

The annual inflation rate, which measures the evolution of consumer prices in the last year, climbed in March to 5 percent, the highest level since June 2013, back when it stood at 5.37 percent, according to data recently published by the National Statistics Institute.

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