“We all want lower interests but for that we need lower deficits. We will do our part in lowering the budget deficit. Inflation is expected to slow in the next period. The budget deficit will stay at 3.6% of GDP and perhaps even lower this year. Therefore, if the central bank has any intention to lower interest rates it should do so sooner rather than later,” Citu said Thursday at a conference in Bucharest.
Romania’s central bank board decided last week to maintain the benchmark interest rate on hold at 2.5% a year. It also maintained rates for deposit and lending facilities unchanged at 1.5% and 3.5%, respectively.
Inflation is expected to descent significantly in the early months of 2020 and the central bank sees it at 2.8% at the end of the first quarter. It sees year-end inflation at 3% in 2020.