Selected Articles from IntelliNews Pro IntelliNews Pro

About IntelliNews Pro

IntelliNews Pro has been a trusted resource since 1999 for emerging market business and finance professionals engaged in the markets of Eastern Europe, Eurasia, MENA region and Africa. Users have direct access to locally based analysts to answer questions or gain insight into those markets.

Ask the Analyst from IntelliNews Pro

Romania’s central bank hikes monetary policy rate as expected

Question: Hello - did you see Isarescu commenting on a potential ideal gap between the policy rate and inflation during the Q&A pls?

Answers: Hello, indeed Isarescu touched this topic. But it was about the gap between inflation and money market interest rates [not policy interest rate]. What he clearly said, was that no one should expect the interest rates to rise in line with inflation soon [this would be bankers' wishful thinking, he implied between the lines]. He also mentioned that the [nearly] 2pp between the interest rates and inflation in Europe [euro area] is same in Romania [more or less, with the gap wider in Romania judging by numbers] at this moment. He did not say whether the gap will remain the same, but he implied that the developments in Romania should [and he stressed, in his opinion] converge to the developments in Europe. Both the interest rates and inflation in Romania should converge to same levels as in Europe , he also added. Isarescu also mentioned debates among monetary board's members about the process of normalisation of the monetary policy in Europe -- by normalisation meaning the return to real positive interest rates, sterilisation and monetary transmission mechanism as we know it. It is a process that impacts Romania significantly, he stated, and its dynamics is still unclear. [such normalisation would compress the 2pp gap and in fact, eventually, turn it negative -- our comments here ] In conclusion, the 2pp gap should be regarded as a dynamic target -- likely to follow the developments in the euro area. Because otherwise, combined with the 3.5% y/y yearend conflagration target it would result in 1.5% interest rates at the end of the year [which is unrealistic]. The bottom line: Isarescu's comments were not about the policy rate, but about the interest rates. whole speech here with the para mentioned starting min45  

Show Full Answer   More from Ask the Analyst

Slovak biotech company Axon Neuroscience creates antibodies to stop COVID-19 from reproducing

November 24, 2020

Slovak clinical-stage biotech company Axon Neuroscience has created therapeutic antibodies able to prevent reproduction of the coronavirus (COVID-19), with the efficacy of these antibodies ...

North Macedonia withdraws plans to invest in Bulgaria’s Belene NPP project

November 24, 2020

North Macedonia has withdrawn plans to invest in Bulgaria’s Belene nuclear power plant project, local media reported on November 23, citing the director of the state-run power producer ESM. The ...

Azerbaijan starts construction of 100km highway linking to liberated Shusha in Nagorno-Karabakh

November 24, 2020

Azerbaijan has started the construction of a four-lane bypass to the mountain fortress city of Shusha, liberated from ethnic Armenians during the recently concluded six-week Nagorno-Karabakh ...

Serbia sells 10-year Eurobond worth $1.2bn amid strong investor interest

November 24, 2020

Serbia’s government said on November 24 it has issued a ten-year Eurobond worth $1.2bn on the international market amidst strong investor interest. The bond was issued on November ...

Poland announces new strategy to contain COVID-19

November 24, 2020

Poland’s right-wing government announced a new plan to contain the coronavirus (COVID-19) pandemic on November 21. The plan, dubbed “100 days of solidarity”, assumes retail will reopen under ...

Albania opens third tender for Vlora airport

November 23, 2020

The Albanian government has launched a third tender for the construction of Vlora airport, Infrastructure Minister Belinda Balluku announced on November 23. The previous two tenders failed. The ...

Czech billionaire Kretinsky's EPGC to further increase its share in German Metro

November 22, 2020

Investment company EP Global Commerce (EPGC), owned by Czech billionaire Daniel Kretinsky and his Slovak partner Patrik Tkac, continues to increase its stake in the German trading company Metro, ...

Iran asks Middle East allies to avoid provoking tensions with outgoing Trump

November 20, 2020

Iran has requested that allies across the Middle East be on high alert and avoid provoking tensions with the US that could give an outgoing Trump administration cause to launch attacks in the US ...

Fifth of Israeli travellers returned from Turkey in October test positive for COVID-19

November 19, 2020

Of 988 Israelis who returned from a trip to Turkey between October 1 and October 28, 197, or 20%, tested positive for coronavirus (COVID-19), according ...

Poland suffers record COVID-19 death tally

November 19, 2020

Poland recorded 603 coronavirus (COVID-19) deaths as of November 18, the health ministry said in a daily report.  That is the highest daily number of fatal cases since the pandemic began in ...

Volkswagen to invest €1bn to create 2,000 new jobs in Slovakia

November 19, 2020

The Volkswagen plant in Bratislava plans to create 2,000 new jobs via a planned investment of €1bn, said VW Slovakia's personnel director Sebastian Krapoth at a press conference on November 16. ... ...

Romania’s government revises 2020 budget deficit to 9.1% of GDP

November 19, 2020

Romania's finance ministry has made the third budget revision this year, envisaging a public deficit of RON96bn (€19.8bn), or 9.1% of the year's GDP, up from 8.6% of GDP in the previous revision ...

Iran faces doubling of daily coronavirus death rate if rules are flouted warns health minister

November 18, 2020

Iran’s health minister has warned that the country faces a doubling of its daily rate of coronavirus (COVID-19) deaths if Iranians don’t abide by rules brought in to stem the spread of the ...

Turkey ‘can barely fly its F-16 fighter jets because air force was purged after coup attempt’

November 16, 2020

Turkey’s Erdogan administration has purged the country’s air force to such an extent that it is struggling to find pilots to fly its F-16 fighter jets, defence analyst Michael ...

Skopje expects Bulgarian veto on launch of EU talks on November 17

November 16, 2020

The EU will not give the green light for the start of an Intergovernmental Conference with North Macedonia at the meeting of its foreign ministers on November 17 due to the Bulgarian veto, North ...

Slovenia extends state of epidemic for entire country until December 17

November 16, 2020

The Slovenian government has decided to extend for the second time the coronavirus (COVID-19) epidemic declared on October 19 by another month until December 17. The government has ...

European investors invited to Iran business conference that will imagine sanctions free economy under Biden

November 15, 2020

European investors with ambitions to tap Iranian markets if US sanctions are lifted under the upcoming Joe Biden administration are being invited to attend a December 14-16 conference funded by the ...

Burst bubble Tehran Stock Exchange loses another 5.5% in week

November 13, 2020

A 5.5% drop in the TEDPIX on the Tehran Stock Exchange (TSE) saw the benchmark index drop 69,000 points to 1.221mn in the Iranian calendar week to November 13. Considering the index for the first ...

Turkish defence minister says Ankara will use Russian S-400 missile systems just as some Nato members use S-300s

November 13, 2020

Turkey will use the advanced S-400 missile defence systems it procured from Russia just as other Nato members use S-300 defence systems, Turkish defence minister Hulusi Akar has told members of the ...

North Macedonia’s government adopts 2021 state budget, sets deficit at 4.9% of GDP

November 11, 2020

North Macedonia’s government has endorsed the state budget for 2021 setting the budget deficit at MKD34.8bn (€565.8mn) or 4.9% of the country’s GDP, PM Zoran Zaev said on November 11. The ...