Romania’s National Bank has decided to raise by a
\npoint the reference interest rate up to 4.75% in order to get a firmer grip on
\nliquidity on the currency market and also to keep the present level of the minimum
\nreserves for liabilities in the local and foreign currencies of the credit
\ninstitutions. <\/p>\n
\n
\n
\n
<\/p>\n
The Central Bank’s move has not been anticipated by pundits,
\nsome have envisaged a smaller increase in the reference interest rate though,
\nas it stood under 2% at the beginning of the year. Governor Is\u0103rescu has
\npledged that the Central Bank will be using all the instruments available to
\nkeep liquidity under control. According to him, the inflation will continue to
\nrise at a lower pace by the end of this quarter. And that renders expert
\nforecasts outdated, mainly because of the price hikes higher than expected. <\/p>\n
\n
\n
\n
<\/p>\n
Mugur
\nIs\u0103rescu: Essential in the worsening of the inflation forecasts are the
\nhigher dynamics in fuel, gas and electricity prices in the following months,
\neven against the background of the support schemes applied. Worth mentioning are
\nsome basic effects and the prices in processed food mainly due to the stronger hikes
\nin crude, energy and agri-food products against the background of the war in
\nUkraine and the sanctions entailed. Additional inflationist effects are
\nexpected on the segment of the selling costs, spurred by the higher prices
\napplied by the railway company CFR, as well as the tobacco prices due to the
\nincreased excise. <\/p>\n
Under the present circumstances, the Central Bank
\nhas raised the reference interest rate in an attempt to keep prices at bay. Governor Is\u0103rescu has explained that given the present
\nsituation, central banks must find a balance between fighting inflation and the
\nrisk of bringing economies to recession. In his opinion, it is vital that
\nresources, represented by the EU funds made available to Romania, be capitalized
\nupon properly, including those conditioned by the implementation of reforms.<\/p>\n
\n
\n
\n
<\/p>\n
The reference interest rate is very important being largely
\nemployed by natural persons, companies, banks at the level of the entire
\neconomic system. For instance, banks refer
\nto it whenever they give loans to clients, natural persons and companies. The
\nloan cost fluctuates according to the reference interest rate and as it went up
\nlately it dealt a heavy blow to those with credits in the national currency.
\nThere are also solutions and experts recommend refinancing and opting for a
\nfixed interest rate. On the other hand, inflation rate in May this year stood
\nat 14.5% and experts believe the Romanians are in for more price hikes in
\nproducts and services in the following months.<\/p>\n
\n
<\/p>\n
(bill)<\/p><\/p>\n","protected":false},"excerpt":{"rendered":"
Inflation will continue to increase by the middle of this quarter, Mugur Isarescu, the Central Bank governor has cautioned. Under the present circumstances, the Central Bank decided to raise the reference interest rate<\/p>\n","protected":false},"author":106,"featured_media":82487,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[37738],"tags":[35241,29488,30059,40620],"coauthors":[],"class_list":["post-92801","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-today-in-the-news","tag-bank","tag-inflation","tag-isarescu","tag-liquidities"],"acf":[],"yoast_head":"\n