The central bank left its deposit facility rate unchanged at 0.75% a year and its lending facility rate at 1.75% a year.
It also decided to maintain minimum reserve requirements for local currency deposits at 8% and reserve requirements on foreign currency liabilities at 6%.
This is the central bank’s second policy meeting this year, after it lowered the key rate to 1.25% from 1.5% in January.
The central bank’s board also examined and approved the March 2021 Inflation Report, which incorporates the latest available data and information. It said in the new scenario the annual inflation rate is anticipated to pick up gradually during 2021 until nearing the upper bound of the target band of 1.5%-3.5%, under the impact of supply-side shocks.
Romania’s annual consumer price inflation rate rose to 2.99% in January 2021, from 2.06% in December 2020, and to 3.16% in February, well above the previously-expected level, under the transitory impact of the liberalization of the electricity market for household consumers and following the rise in fuel prices driven by higher oil prices.
High uncertainties and risks to the new outlook stem, however, from the evolution of the pandemic and of the associated restrictive measures – amid the spread of the third pandemic wave, including domestically –, as well as from the dynamics of vaccination worldwide, but especially across the EU.
Other major sources of uncertainties and risks refer to the fiscal policy stance, in the context of the budget consolidation presumed to be carried out gradually over the medium term, alongside the absorption of European funds allocated to Romania, as well as labor market developments, under the influence of the public health situation and government support measures, the central bank noted.