Romania Central Bank Cuts Key Rate By 0.25 BPs To 5.5%
Romania’s central bank Thursday cut its key monetary policy rate by 25 basis points for the third consecutive time to a record low of 5.5% a year, in line with analysts’ expectations, as inflation is subdued and domestic consumption remains weak.
The bank kept the minimum reserve requirements unchanged at 15% for Romanian-leu denominated liabilities and at 20% for foreign currency liabilities.
The rate cut follows several months of reduced inflation, with the annual rate at 3.1% in December, the lowest in over two decades.
The central bank targets an annual inflation of 3% at the end of 2012, plus/minus one percentage point around the band. The bank recently revised down its year-end forecast to 3% from 3.5%, saying it expects a favorable base effect and lower volatile prices.
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