Romania's National Central Bank decided to reduce the monetary policy interest rate by 0.5 percentage points, to 9% /year starting July 1, a press release of the central bank reads. Moreover, the bank decided to reduce the minimum mandatory reserve rate to 15% for stocks in lei and to 35% for stocks in foreign currency.
The key interest rate, reduced from 9.5% to 9% was expected by local financial analysts. According to an internal study put forward by the Financial - Banking Analysts Association in Romania, 86% of the participants estimated that the national bank might reduce the monetary policy interest rate due to the negative trend of the economic environment in the first quarter of the year.
UPDATE: ING Bank Senior Economist Nicolaie Alexandru Chidesciuc declared for HotNews.ro that, at first, the impact of the Central Bank decision will not be felt on the market. However, in time, the effects will be seen in credits as they will increase by the end of 2009, beginning of 2010.
ING Bank representative declared that in order to stimulate the economy, the central national bank needs to decrease steadily the key interest rate. He declared that there will be a gradual increase in credits due to this measure.