Romania cuts rates to record low – more to come? | beyondbrics

Romania cuts rates to record low – more to come? | beyondbrics:

"

Romania’s interest rates have hit a record low, but will it be enough to revive its flagging economy?

As central banks in some developed markets seem to be gearing up for tighter monetary policy, Romania’s announced a third consecutive interest rate cut on Monday, citing falling inflation, and with an eye on sluggish growth.

The National Bank of Romania (BNR) lowered its core rate by 25 basis points to 4.25 per cent, its lowest-ever rate, and may cut further before the end of the year.

“The annual inflation rate remained on a downward path, reaching 3.67 percent in August 2013 from 4.41 per cent in July due to the decline in volatile prices, of food items in particular, amid the ongoing negative output gap,” the bank said in a statement. “The annual adjusted CORE2 inflation rate dropped to 2.24 per cent in August 2013. This trend, in line with the central bank’s forecasts in the latest Inflation Report, strengthens the favourable outlook for the annual inflation rate to fall below the 2.5 per cent target in the forthcoming period.”"

'via Blog this'