The Board of Directors of the National Bank of Romania decided, on Tuesday, to maintain the monetary policy interest rate at the level of 7% per year, informs the central bank.
Also, the board of the central bank (BNR) decided to keep the interest rate for the lending facility (Lombard) at 8% per annum and the interest rate for the deposit facility at 6% per annum and to maintain the current levels of the mandatory minimum reserve rates for liabilities in lei and in foreign currency of credit institutions.
The key interest rate has been unchanged since January last year, when the BNR increased the interest rate to 7% per annum from 6.75% per annum.
“The decisions of the CA of the BNR aim to bring the annual inflation rate back in line with the stationary target of 2.5% ± 1 percentage point, including by anchoring inflationary expectations in the medium term, in a way that contributes to the achievement of sustainable economic growth. In the current context, the balanced mix of macroeconomic policies and the implementation of structural reforms, including through the use of European funds to stimulate long-term growth potential, are essential for maintaining macroeconomic stability and strengthening the capacity of the Romanian economy to face adverse developments”. specifies the institution, according to Agerpres.
According to the BNR, the annual inflation rate fell to 6.61% in December 2023, below the forecast level, from 6.72% in November, amid the continued slowdown in the growth of processed food and energy prices, which outpaced the significant rebound of the annual fuel price dynamics, due to a base effect.
On the whole of the IV quarter 2023, the annual inflation rate accelerated its decrease more than anticipated, decreasing by 2.22 percentage points (from 8.83% in September), in the conditions where the dynamics of food and of energy continued to decrease relatively sharply, and the basic inflationary effect on the fuel segment was fully counterbalanced by the deceleration of the increase in administered prices and the price of tobacco products.
“In 2023, the annual inflation rate thus decreased by 9.76 percentage points (from 16.38% in December 2022), in the context of major contributions, almost equal, brought by the decreases in dynamics recorded by the prices of processed foods and by energy prices. Additional, but much more modest, disinflationary influences came from the LFO and fuels segments, while small, opposite effects were generated by the non-food goods and market services sub-components of core inflation,” the report also said.