Romania's central lender slashes key rate to 8.5%, cuts reserves to 30% for foreign currency
Publish date: 05-08-2009The central lender BNR decided to reduce the monetary policy rate from 9 percent to 8.5 percent per year, according to analysts' expectations, but surprised the market by cutting minimum mandatory reserves for foreign currency from 35 percent to 30 percent.
Moreover, BNR decided to cut the maturity for repo operations of pumping money on the market from one month to one week, the central lender's release reads.
Following today's decision, the monetary policy rate goes back to the level of February – March 2008, when BNR was pursuing the tightening of the monetary policy. Starting with the beginning of 2009, the central lender slashed the key rate by 1.75 percentage points, from 10.25 percent to 8.5 percent per year.
The interest rates for the credit facility (lombard) and for the deposit facility will subsequently be reduced from 13 percent to 12.5 percent and from 5 percent to 4.5 percent respectively, as they are fixed at plus/minus 4 percentage points compared to the key rate.
However, the real surprise was the decision to cut minimum mandatory reserves for foreign currency, as most analysts expected the central lender to keep the current level in order to be able to analyze the effects of the last monetary policy decision on the market.
money.ro
Latest News:
- Insurance market stagnated in 2013 while GDP chare dropped to 1.3%
- The Romanian Leasing Market as of December 31, 2013
- Millennium Bank reports best results since its launch, helped by stronger banking income and cost cuts
- BCR cheapens First Home loans and lowers interest loans for loans in lei
- Millennium Bank's new Salary account clients receive up to 600 lei bonus and their utility bills' payment
- GarantiBank and Seamless introduce SEQR in Romania: the newest mobile payment solution
- Bancpost telecom services, now provided exclusively by Romtelecom and COSMOTE Romania
- Millennium Bank cards offer discounts in Domo stores
- BCR Supervisory Board reshuffles Management Board
- NBR decide to lower the monetary policy rate to 4.25 percent per annum
- Common appointments in Romtelecom and COSMOTE Romania
- Up to 5.5% annual interest rate for Millennium Bank's promotional three-month lei deposit
- Eurozone in recovery mode but gap between North and South still widening
- UniCredit Tiriac Bank and RBS Romania announce the successful completion of the retail clients' migration
- Millennium Bank grants First House loans in lei