Romania Central Bank Says It Raises Interest Rates at Own Pace

(Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.

Romania’s central bank defended its decision to raise interest rates less than expected this week, saying it’s paying more attention to the nation’s faltering growth than looking at steps taken by other policy makers in the region.

On Monday, the rate setters raised borrowing costs by 25 basis points to 2%, a move predicted by five out of 11 economists surveyed by Bloomberg. The other six expected a 50 basis-point hike. 

“We are of course looking at what the other central banks are doing, we can’t be decoupled from the region and we are too in a process of tightening the monetary policy, but we’re following our own strategy that’s adapted to the particularities of the Romanian economy,” bank spokesman Dan Suciu said by phone on Tuesday. We are “raising the key rate at our own pace.” 

The bank is taking into consideration how such steps will impact the already slowing economic growth hampered by the pandemic, the global energy crisis and the aftermath of a prolonged political crisis, he said.

©2022 Bloomberg L.P.