Prime minister Mircea Ciolacu, who also serves as president of the Social Democratic Party (PSD) – likely to remain the senior ruling partner after the parliamentary elections this year, said that central bank (BNR) governor Mugur Isarescu should stay in office for another term to secure the country's monetary stability.

"Romania needs monetary stability, and I think that [Mugur] Isarescu must stay for another mandate," Marcel Ciolacu told Prima TV, quoted by Economica.net.

Unlike other central banks in the region, BNR has not been involved in conflicts with the government or severely criticized by the opposition over the past decades since Isarescu runs the monetary authority. At the same time, the country's central bank maintained a roughly stable exchange rate by running a controlled floating exchange rate regime (that sometimes led to significant real appreciation of local currency).

Separately, Romania's inflation remained among the highest in the region partly because of the not particularly hawkish monetary policy (which has been favorable to financing the government's wide deficits).

Asked recently whether he was considering the option of another term, governor Isarescu (74) said that the parliament will decide on this matter.

The world's longest-serving central bank chief, the governor of the National Bank of Romania (BNR) Mugur Isarescu, is likely to get another five-year term this autumn that would also be his last, according to sources familiar with the negotiations commenting in February this year.

The first deputy governor, Florin Georgescu (70), is expected to step down because of health issues, while his seat will be filled by Leonardo Badea, currently deputy governor.

Both Georgescu and Badea have the support of the Social Democratic Party (PSD), which appointed them to various top positions within public financial institutions.

iulian@romania-insider.com

(Photo source: Inquam Photos/Octav Ganea)