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

Romania’s Hidroelectrica takes first steps towards IPO

May 17, 2019

Romania's biggest power producer Hidroelectrica launched a call for the acquisition of legal services related to listing its shares on the Bucharest Stock Exchange by an IPO that has been expected ...

Sweden’s Handelsbanken to stop operations in Baltic states

May 17, 2019

Swedish bank Handelsbanken said on May 16 it was “set to gradually discontinue its operations” in the Baltic states and subsequently close its branches in Tallinn, Riga and Vilnius. “Despite ...

Trump told defence chief he ‘doesn’t want war with Iran’ officials brief US media

May 16, 2019

US President Donald Trump has told his acting defence secretary Patrick Shanahan that he does not want to go to war with Iran, the New York Times ...

Turkey 'rivals US and UK as world’s most prolific user of killer drones’

May 15, 2019

Turkey now rivals the US and the UK as the world’s most prolific user of killer drones, according to a review by The Intercept of reported lethal drone strikes worldwide, ...

Oil price analysts wise up to limpet mines and drones as US, Iran tensions simmer

May 15, 2019

Limpet mines and drones are now on the minds of those tasked with plotting the course of world oil prices, as analysts continue to assess whether a military ...

IFC, EBRD buy nearly half of Romania's first covered bonds from Alpha Bank

May 15, 2019

Alpha Bank Romania announced that it has completed its first covered (mortgage) bond issue worth €200mn with a maturity of five years, a first for the banking market in Romania.  With these ...

Turkey’s S-Sport cancels NBA coverage after Erdogan critic and player Enes Kanter’s team advances

May 14, 2019

Multiple US news outlets on May 14 carried reports on how the NBA's Western Conference finals will not be televised in Turkey because they will feature the Portland Trail Blazers' Enes Kanter, a Turk ...

Croatian court starts bankruptcy proceedings at Uljanik

May 13, 2019

The commercial court at Pazin has decided to start bankruptcy proceedings at Uljanik Shipyard, its parent company, ...

Simonyte and Nauseda to face each other in run-off vote for Lithuanian presidency

May 13, 2019

Two centre-right economists will battle it out to become Lithuania’s next president in a run-off vote, results of the presidential election showed early on May 13. The incumbent prime minister ...

Albanian opposition protesters throw Molotov cocktails at PM's office

May 12, 2019

Another major anti-government protest by Albanian opposition parties erupted on May 11 in Tirana. The protest became violent as some protesters clashed with the police. The opposition led by ...

Surprise Pompeo visit to Iraq dealt with threat to US troops from pro-Iran militia if hostilities break out: reports

May 11, 2019

The danger of pro-Iran militias attacking US troops in Iraq if Washington becomes embroiled in a military clash with Tehran was reportedly on the agenda of the US secretary of state when ...

Turkey’s central bank employs secondary tools to combat lira’s latest slump

May 9, 2019

Turkey’s central bank, under pressure for an emergency rate hike with the Turkish ...

EBRD projects Mongolia’s GDP growth will slow to 6.2% in 2019

May 9, 2019

Mongolia’s economy is projected to grow by 6.2% in 2019, down from 6.9% in 2018, and slow further to 5.0% in 2020, the European Bank for Reconstruction and Development (EBRD) said in ...

Trump orders sanctions on Iran’s metals exports

May 9, 2019

Donald Trump on May 8 ordered new sanctions on Iran, targeting metals, Tehran's largest non-petroleum-related source of export revenue. "Today's action targets Iran's revenue from the export of ...

Flaws cited in scrapping Istanbul’s mayoral vote ‘should mean annulling of Erdogan’s mandate too’

May 8, 2019

The electoral flaws which Turkey’s ruling AKP used to trigger the cancellation of the March 31 Istanbul mayoral vote also occurred in last year’s national elections, meaning President Recep ...

OSCE says presidential vote in North Macedonia well run but reforms to electoral code needed

May 6, 2019

The OSCE said on May 6 that the second round of the presidential election in North Macedonia was calm and well run, but shortfalls in the legal framework continued to be a concern. Stevo ...

Chinese investor interested in developing free economic zone at Moldova's Marculesti airport

May 6, 2019

Officials from Moldova’s ministry of economy discussed plans to invest in the Moldovan air transportation sector with representatives of the Sichuan Ruifeng Investment Management Group (China) on ...

Hungary’s OTP Bank signs deal to buy Slovenia’s SKB Banks

May 5, 2019

Hungary’s OTP Bank said on May 3 it has signed an acquisition agreement on purchasing a 99.73% shareholding of SKB Banka, the Slovenian subsidiary of Societe Generale Group, and other local ...

HIB Petrol instals first electric car charger in Kosovo

May 3, 2019

The largest Kosovan fuel company HIB Petrol has installed the first electric car charger in the country. It will be free of charge for one year. HIB Petrol has installed the Terra 53 Charger ...

Inefficient state-owned companies compromise productivity of Croatian economy, IMF says

May 2, 2019

Inefficient state-owned enterprises compromise the productivity of the Croatian economy, the International Monetary Fund (IMF) said on May 2, after a team from the fund paid a visit to Zagreb ...

Dismiss