Romania’s central bank today raised its key interest rate by 75 basis points to 5.50%, below analysts’ estimates, as it expects inflation to peak in the third quarter and the economy to slow further.
This was the eighth consecutive increase in interest rates by the central bank, as reported by Reuters.
In July the bank made a 100 basis point increase, the biggest in more than a decade, with bank governor Mugur Isarescu noting that the pace of tightening will slow once inflation starts to ease.
Analysts had expected the bank to make another 100 basis point increase today.
In the statement released today, the central bank warns that “GDP developments in the second quarter indicate a significant slowdown in growth.”