“We are sending a signal for banks to start an easing cycle, but we urge the banks not to begin by reducing interest rates on deposits,” Isarescu told a news conference.
The central bank last week has narrowed the corridor around the monetary policy rate for the interest rates on its standing facilities to +/- 3 percentage points from +/- 4 percentage points previously. The decision is expected to temper interest rate volatility on the money and banking markets, the central bank said.
According to Isarescu, a lower Lombard rate should reflect in reduced loan rates in the interbank market to stimulate domestic lending.
“[Lenders are saying] there is no demand for loans. But who would want to take out a loan at a 15% interest rate when the inflation rate is dropping? Commercial banks must not seek reasons to not give out loans,” the central bank’s chief said.