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 https://www.youtube.com/watch?v=ttY05QnX034 with the para mentioned starting min45  

Show Full Answer   More from Ask the Analyst

Turkish kitchenware maker Hisar’s plant to undergo Ziraat Bank executor’s sale

March 8, 2021

Turkish kitchenware maker Hisar has “left” its plant in Istanbul’s Esenyurt district with government-run Ziraat Bank in exchange for a loan debt, Ismail Erdogan, chairman of the ...

Borsa Istanbul CEO Atilla takes leave sparking speculation he’s set to be replaced

March 7, 2021

Hakan Atilla, the former Turkish banker who served a prison sentence in the US for helping Iran evade sanctions, has taken leave as CEO of Borsa Istanbul until shareholders meet later this month, ...

IFC exits Bulgaria's Advance Terrafund REIT

March 1, 2021

Bulgaria's Advance Terrafund REIT said on March 1 that the International Finance Corporation (IFC) sold its 17.7% stake in the company for an undisclosed price on February 23. Meanwhile, Bulgarian ...

EIB Group invests €530mn in Croatia in 2020

March 1, 2021

The European Investment Bank Group (EIB Group) said it has secured €530mn in loans, equity and guarantees in Croatia in 2020. “The two parts of the EIB Group, the European Investment Bank ...

Fitch expects Ukraine to receive only one disbursement from IMF, issue more Eurobonds in 2021

March 1, 2021

International ratings agency Fitch says that it expects Ukraine to receive only one disbursement of $700mn this year under its $5bn ...

Belgrade to announce public call for building Serbia-Bulgaria gas intersection

February 28, 2021

A public call for selecting companies for the construction of the Serbia-Bulgaria gas interconnection is expected to be announced next week, after approvals from the competent European institutions, ...

USAID donates medical equipment to help Uzbek region's fight against TB

February 26, 2021

The U.S. Agency for International Development (USAID) has handed over medical equipment to 12 healthcare facilities in the central Syrdarya region of Uzbekistan to assist in the fight against ...

USAID and Kazakhstan launch five year $39mn regional energy programme for Central Asia

February 26, 2021

The US government via the US Agency for International Development (USAID) in partnership with the Kazakh Ministry of Energy has launched a five-year and $39mn regional energy ...

OECD suggests Lithuania boosts municipal borrowing capacity, introduce additional taxes

February 26, 2021

Lithuania needs to increase the borrowing capacity of its municipalities for public investment to bring in as much benefit for the country's economy as possible, the Organization for Co-operation and ...

Istanbul listed Sabanci Holding reports 2020 profit of 5bn lira

February 25, 2021

Istanbul-listed Sabanci Holding (SAHOL), the second largest conglomerate in Turkey behind Koc Holding (KCHOL), produced a 2020 profit of Turkish lira (TRY) 4.77bn, almost exactly a billion lira up ...

EBRD to fund two water and wastewater upgrade projects in Bulgaria

February 25, 2021

The European Bank for Reconstruction and Development (EBRD) said on February 25 it will provide co-financing for two water and wastewater utility upgrade projects in Bulgaria. The two ...

Scatec, Nizam Energy close financing for Pakistan’s 150-MW Sukkur solar project

February 24, 2021

Norwegian renewable developer Scatec and local partner Nizam Energy have secured a $100mn financial closure for the 150-MW Sukkur solar project in Pakistan’s Sindh Province. The closure comes ...

EBRD’s regional small business programme records 10,000 participants to date

February 24, 2021

Over 10,000 financiers in Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan have participated in the Regional Small Business ...

ITC to provide training sessions in improving sewing performance for Tajik professionals

February 24, 2021

The International Trade Centre (ITC) is set to provide intensive training courses on improving the sewing performance of Tajik professionals at clothing firms and ...

Albania’s parliament votes to ratify €80mn KfW loan for municipal infrastructure

February 24, 2021

Albania’s parliament voted to ratify an €80mn loan agreement between the Albanian state and German development agency KfW at a session on February 22. The draft law was approved with 95 votes in ...

World Bank provides $12.6mn in grant financing for COVID-19 relief in Tajikistan

February 23, 2021

The World Bank is providing $12.57mn in grant financing for ...

Turkmenistan approves proposal to open rep office of United Nations Office for Project Services

February 23, 2021

Turkmen President Gurbanguly Berdimuhamedov has approved the opening of a representative office of the United Nations Office for Project Services (UNOPS) in Turkmenistan, ...

World Bank to provide $36.5mn for second phase of rehabilitation of Tajikstan’s Nurek hydropower plant

February 23, 2021

The World Bank will provide $36.5mn for the rehabilitation of the Nurek hydropower plant in Tajikistan based on a grant agreement signed by the government of Tajikistan and ...

EU baulks at hitting Russia with sanctions, issues a short-list of anonymous officials

February 22, 2021

The European Union foreign ministers could hardly have imposed less sanctions on Russia at a government meeting on February 20 if they had tried. Russia critics and Team Navalny have been calling ...

Hardline Iranian MPs baulk at government’s arrangement with UN nuclear inspectors

February 22, 2021

Hardline Iranian MPs on February 22 protested against the Rouhani government’s decision to permit “necessary” monitoring of Iran’s nuclear development programme by the UN nuclear watchdog for ...

Dismiss