Romania's central bank announces reference interest rate of 10.25% for Sept., on inflation pressure

The reference interest rate increased from 10 percent to 10.25 percent, on par with the key interest rate, Romania's central bank (BNR) announced on its website.

The current level of the reference rate is the highest since March 2005, when the central bank announced a diminishing in the interest from 15.69 percent to 10.75 percent yearly.

BNR also amended the inflation prognosis for the end of 2008 to 6.6 percent, considering an inflation target of 3.8 percent, take or give 1 percentage point.

The reference interest announced for August (10 percent) is almost 4 percentage points over the August 2007 interest, of 6.1 percent, which stood out as a minimum of the past years.

At that time though, BNR was repealing the liquidity excess on the market through a "market" interest, obtained by comparing the supplies. Now BNR pays the banks for the deposits drawn from them an annual interest equal to the key interest rate.

Most analysts see as doubtful a rise in the BNR key interest by the end of the year, as this year's maximum inflation rate was reached in July and stood below estimates, at 9.04 percent.

NewsIn