In its meeting on October 5, in line with expectations, the Board of the National Bank of Romania (BNR) kept the monetary policy unchanged, as the “major uncertainties and risks surrounding the inflation outlook” beyond the yearend, internal (fiscal package) as well as external, indicate the rate cuts will not climb up on the agenda any soon.

Thus, BNR, “in light of the elevated uncertainty,” decided to keep the monetary policy rate at 7.00%, to leave unchanged the lending (Lombard) facility rate at 8.00% and the deposit facility rate at 6.00%, and to keep the existing levels of minimum reserve requirement ratios on both leu- and foreign currency-denominated liabilities of credit institutions.

The annual inflation rate continued to decline in the first two months of Q3 overall, in line with forecasts, going down from 10.25% in June to 9.43% in August.

The annual adjusted CORE2 inflation rate saw a faster decrease in the first two months of Q3, falling slightly below the forecast to reach 12.0% in August, from 13.5% in June.

iulian@romania-insider.com

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