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 with the para mentioned starting min45  

Show Full Answer   More from Ask the Analyst

Turkey’s Erdogan says rival trying to “steal” votes by visiting jailed pro-Kurdish candidate

June 6, 2018

Turkish President Recep Tayyip Erdogan on June 6 claimed one of his main rivals was trying to “steal” votes among Turkey’s Kurdish community by visiting a pro-Kurdish candidate in jail on ...

Alarm in water crisis-hit Iraq as Turkey holds back dam water earlier than pledged

June 6, 2018

Iraq’s prime minister on June 5 told a news conference that he is surprised by Turkey’s decision to start holding back water behind its Ilisu dam earlier than pledged. Haider al-Abadi added ...

Share price of Turkey’s Fenerbahce football club surges as Koc is appointed chairman

June 5, 2018

The share price of Turkey’s Fenerbahce football club leapt on June 4 after it elected businessman Ali Koc as chairman for the next three years. Koc, 51, a member of Turkey’s wealthiest family ...

Nagorno-Karabakh protests enter their third day

June 5, 2018

Demonstrators blocked off one of the central streets in Stepanakert, the capital of the Azerbaijani separatist republic of Nagorno-Karabakh, on June 4 as protests entered their third day.  ...

Bulgaria's far-right defence minister calls for hardening of position towards EU

June 4, 2018

Bulgaria should harden its tone towards the European Union and warm up its relations with Russia, Krassimir ...

Surprise win for pro-EU candidate Nastase in Chisinau election

June 4, 2018

The pro-EU candidate Andrei Nastase of the Dignity and Truth Political Party (PPDA) won the second round of the elections for Moldova’s capital city Chisinau with 52.6% of the votes. Nastase ...

Uber is “over” in Turkey, Erdogan tells guests at Istanbul dinner

June 4, 2018

The business of ride-hailing company Uber Technologies Inc. is “over” in Turkey, the country’s President Recep Tayyip Erdogan reportedly said on June 1. “There is no such thing anymore. We ...

Belgian court unfreezes $21.5bn of Kazakh assets in dispute with Moldovan oligarch Stati

May 31, 2018

A Belgian court has lifted a freeze on Kazakh National Fund assets worth $21.5bn imposed as part of a dispute with Moldovan oligarch Anatolie Stati, the Kazakh justice ministry said on May 30. It ...

Hungary's electric sports aircraft maker expands production

May 31, 2018

Hungary's Magnus Aircraft is constructing a new manufacturing plant in southern Hungary near the regional Pecs-Pogany airport to meet rising demand for its unique aircraft and plans to finish ...

Romanian prosecutors raid Holzindustrie Schweighofer plants in illegal logging probe

May 31, 2018

Romania’s Directorate for Investigating Organised Crime and Terrorism (DIICOT) raided on May 30 the offices and two plants of Austrian wood processing company Holzindustrie Schweighofer, local ...

Record-breaking year for Czech firearms company

May 30, 2018

Ceska zbrojovka Uhersky Brod (CZUB), the Czech firearms manufacturer, had a record-breaking year with a profit of CZK625mn ...

Kosovo moves to revive major mining complex Trepca

May 30, 2018

The government of Kosovo approved the statute for Trepca at its May 29 meeting, almost two years after the major mining complex was put under government control in a bid to save it from bankruptcy, ...

Nuclear deal exit latest: Swiss bank, Indian lenders, Russia’s Lukoil, Czech industry minister and drop out

May 29, 2018

A Swiss bank on May 29 suspended new transactions with Iran and said it was winding down Iran-related activities while two Indian banks reportedly asked exporters to complete their financial ...

EBRD makes its largest ever equity investment in the tourism sector buying into D Marinas

May 29, 2018

The European Bank for Reconstruction and Development (EBRD) announced on May 29 it has signed investment agreements to become a shareholder in D Marinas B.V., the holding company for a network of ...

Gyorgy Waberer to list logistics company BILK on Budapest bourse

May 29, 2018

Gyorgy Waberer, the former owner of haulage company Waberer, plans to list shares of Budapest logistics terminal BILK on the Budapest Stock Exchange in June, local media reported on May 28. “I ...

Azerbaijan to seek better terms from Formula One

May 28, 2018

The organisers of the Azerbaijan Grand Prix have asked global motorsports business Formula One to reduce the race sanctioning fee they have to pay, according to reports in the sports media.  ...

Hungary reaches deal with Gazprom on 2019 gas deliveries

May 28, 2018

Hungary has reached an agreement with Russian gas giant Gazprom on the volume and price of next year's gas deliveries and negotiations have begun on gas deliveries for 2020, Foreign Minister Peter ...

Wizz Air chief sees further consolidation in CEE airline industry ahead

May 28, 2018

Budapest-headquartered budget airline Wizz Air expects the wave of consolidation in the sector to continue. Fuel prices are exerting pressure on high-cost airlines, but Wizz Air is in a better ...

China’s Hisense acquires 22.56% of Slovenia’s Gorenje

May 26, 2018

Slovenian household appliances manufacturer Gorenje Group announced on May 24 that Hisense Luxembourg Home Appliance Holding and Hisense Luxembourg Holding have acquired a combined 22.56% in the ...

US bans imports of Turkmen cotton goods following child and forced labour claims

May 25, 2018

The US government has banned all imports of cotton goods from Turkmenistan without specifying the reason. The ban is contained in an order issued by the US Customs and Border Protection (CBP) ...