January 9 (SeeNews) - Romania's central bank is likely to maintain its key rate to 6.75% at its January 10 board meeting, as a hike would bring little benefits and somewhat go against recent de facto easing in monetary conditions, Austria's Erste banking group said.
The BNR lagged peer central banks in hiking rates over the past year. The deposit facility, which is 100bp below the key rate, has been the relevant instrument over the past couple of months for the bank in response to the appreciation of the leu currency, and should weight significantly in the decision making, Erste analysts said in a short note on Romania last week.
In the analysts' view, latest inflation readings, especially core inflation coming in significantly higher than the central bank's November forecast, provide solid arguments for a last 25bp hike, to which they attach a 30% probability. Romania's consumer prices rose 16.76% on the year in November, compared to an increase of 15.32% in October, the statistics office said earlier.
On November 8, BNR decided to increase its monetary policy rate to 6.75% from 6.25% in an attempt to anchor inflation expectations over the medium term, as well as to foster saving through higher bank rates.
(1 euro= 4.9293 lei)