Romania’s National Bank cuts interest rate to 3.25%

Romania’s National Bank (BNR) decided on Monday, August 4, to reduce the monetary policy interest rate for local currency (RON) to 3.25 percent per year, from 3.5 percent per year. This is a new low for BNR’s monetary policy interest rate. This move, which should determine local banks to further reduce interest rates for loans in local currency, should help boost lending and support Romania’s economy. However, bank deposits in RON are becoming less attractive. The BNR also decided to maintain the existing levels of minimum reserve requirement ratios on both RON and foreign currency-denominated liabilities of credit institutions. The central bank’s board also examined and approved the quarterly inflation report, which will be presented to the public on August 6, 2014.
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