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

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 ...

Turkey’s Turkven sells 33% stake in London listed DP Eurasia for GBP25mn

February 22, 2021

Turkish private equity fund Turkven has sold its 32.81% stake in DP Eurasia (DPEU/London) to Jubilant Foodworks, the largest food service company in India, for GBP24.8mn, DP ...

UNIDO and Japan support sustainable development of Iranian tuna fish value chain

February 22, 2021

The Japanese government and the United Nations Industrial Development Organization (UNIDO) have signed a funding agreement for a project to promote the sustainable development of the tuna value chain ...

Iran ‘weighing EU proposal for informal talks with nuclear deal members and US’

February 22, 2021

Iran is assessing a European Union proposal for an informal meeting between current members of the 2015 nuclear deal and the US, but has yet to respond to it, Iranian Deputy Foreign Minister Abbas ...

IIB inaugurates new HQ in Budapest

February 21, 2021

The International Investment Bank (IIB) inaugurated its new headquarters in Budapest in Lanchíd Palota, a landmark Neo-Renaissance style palace next to the iconic Chain Bridge on February 19. ...

Drop in diaspora inflows pushed up Kosovo's current account deficit says IMF

February 21, 2021

The International Monetary Fund (IMF) said that Kosovo’s current account deficit is estimated to have increased to 7.5% of GDP mainly due to a large decline in diaspora-related inflows, ...

EBRD provides $100mn loan to support green investments and women entrepreneurs in Turkey

February 20, 2021

The European Bank for Reconstruction and Development (EBRD) has provided $100mn in funds to Turkish private lender Denizbank to finance local companies’ investments in green technologies and ...

EBRD provides €2.5mn loan to ProCredit Bank to support green investments

February 20, 2021

The European Bank for Reconstruction and Development (EBRD) is providing a €2.5mn loan to ProCredit Bank Kosovo to support on-lending for green investments, the lender said on February 19. The ...

Siemens Gamesa delivers turbines to Djibouti’s 59-MW Goubet wind farm

February 19, 2021

Siemens Gamesa has this week delivered all the components for 17 of its SG3.4-132 turbines that it will install at its 59-MW Goubet wind farm in Djibouti, despite the challenging conditions ...

Daystar to seek $100m over three years for West African solar projects

February 19, 2021

West Africa hybrid solar power solutions provider Daystar Power plans to raise about $100m within the next three years to satisfy existing client demand. “The market size and funding gap is ...

Africa accounts for just 6% of global energy demand

February 18, 2021

Kevin Kariuki, vice-president power, energy and green growth at the African Development Bank (AfDB), made several assertions at the second webinar series of the Africa Investment Roundtable ...

Iran “playing with fire” with further nuclear deal breaches says German foreign minister

February 18, 2021

Iran’s latest moves in breaching the 2015 nuclear deal jeopardise a return of the US to the accord, German Foreign Minister Heiko Maas warned on February 18. “The more pressure is applied, the ...

US, Shell to provide $145mn to support Africa’s private power sector

February 18, 2021

The US Development Finance Corporation (DFC) and the Shell Foundation have signed a partnership to strengthen their investments in renewable energy in Africa and Asia. The two partners will invest ...

Dismiss