Romanian central bank governor Mugur Isarescu: last week, the Romanian national currency avoided an attack

Mugur Isarescu, Romania’s Central Bank governor, one of the most discrete public figures, sustained his second press conference in seven days to talk about the developments in the financial and monetary systems. Isarescu declared that last week, Romania’s national currency had to confront with a failed attack. He added that last week, after the exchange rates moderated, the wave moved on to the monetary market. For a technician, Isarescu said, there was nothing special. However, commercial banks rushed to tax their clients which provoked tensions.

Isarescu advised banks to avoid taxing clients due to the ROBOR/ROBID rate increases. ROBOR is the average rate for credits contracted in Romanian Ron on the banking market and is established by the National Central Bank, each day, at 11:30 am. Therefore, Isarescu declared that the rates reflect only partially the realities of the monetary market.

Isarescu explained that last Friday, the Bank set up an effective transaction rate of 22% even if the ROBOR rate exceeded 40%. He advised banks to treat the situation responsibly in order to maintain their clients and not scare them off.