The National Bank of Romania (BNR) announced on Tuesday that it will increase its monetary policy rate to 1.75% from 1.50% as of November 10, according to See News.
“BNR decided to keep the deposit facility rate to 1% per year and raise the lending facility rate to 2.50% from 2%,” the bank said in a statement after a board meeting on monetary policy.
Romania’s Central Bank also decided to maintain the existing ratios of minimum reserve requirements for both leu and foreign currency-denominated liabilities of banks.
BNR’s current assessments indicate a significant additional worsening of the inflation outlook almost throughout the projection horizon, under the strong impact of supply-side shocks.
The forecast path of the annual inflation dynamics has been again revised considerably upwards, especially over the short term.
“The annual inflation rate is expected to remain on a steep uptrend until mid-2022, hence to climb further above the variation band of the target and above the previously forecast levels, mainly as a result of the sizeable hikes anticipated for energy prices in the last quarter of this year and the first quarter of 2022, amid the abrupt rise in international prices,” the central bank noted.
The next monetary policy meeting of the central bank’s board is scheduled for January 10