BNR: Key rate remains unchanged at record low of 3.5 percent

Romania’s central bank left its key rate unchanged at a record low of 3.5 pct on Friday, ending an eight-month long monetary easing cycle, amid higher inflationary pressures.

The decision was already predicted by analysts, who expected the rate freeze due to increased inflationary pressure largely stemming from a new tax duty on fuels and energy price deregulation.

Recent developments in emerging markets and capital flow volatility also add up to the pressure.

The bank also maintained its minimum reserve requirements unchanged at the Friday meeting, as interbank liquidity remains high. The minimum requirements were kept at 12% for Romanian-leu denominated liabilities and at 18% for foreign currency liabilities.

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