The Romanian Central Bank BNR recently decided to slash the key interest rate by 0.25 percentage points, to 5 percent. This is the first drop in the key interest rate since May 2012. The BNR kept the minimum mandatory reserves to 20 percent for passives in foreign currencies, and at 15 percent for RON. The drop in key interest rate was expected sometime in the fall, according to analysts. The BNR governor Mugur Isarescu had suggested earlier this year that the BNR will begin to relax the monetary policy.

The drop in key interest rate was also accompanied by a drop of the interest rate for the overnight loan facility for banks, at 8 percent.

editor@romania-insider.com