Daily Newsletter - 9 January 2018


Macroeconomic News (3)

Public administration debts down 

The aggregated debts of the public administration fell 1.8 pp as percentage of the GDP in the third quarter of 2017, reaching 23.9%, according to a report released by the National Bank of Romania (BNR). "The state's stock holdings fell 0.6 pp, down to 8.9% of GDP. The public administration's deposits fell 0.4 pp, down to 8.2% of the GDP, while other receiving accounts fell 0.7 pp, down to 6% of GDP," according to BNR.


Retail turnover up 0.7% 

The aggregated turnover of the retail sector gained 2.4% in November, 2017, compared to the previous month. The figure does not include car and motorcycle sales. The annualized growth rate is 11.7%, adjusted for the year's season and the number of working days, according to a press release issued by the National Statistics Institute (INS).


Regulated price for household clients to increase by RON 4.8 per month 

The Romanian Energy Regulatory Authority (ANRE) announced on Monday that the regulated prices for natural gas paid by household clients would increase by an average of RON 4.8 per month for an average consumption of 700 kWh/consumption location. The decision was approved by ANRE's Regulatory Committee on Monday.


Financial News (4)

BNR rate hike to push interest rates higher 

The National Bank of Romania's (BNR) decision to increase the key rate from 1.75% to 2% will push up the interest rates of loans and, after about a month, the interest rates of deposits, while the ROBOR rate will "climb", according to economic analyst Dragos Cabat. "It should be noted that this key rate hike is an effect of inflation, not the cause," said Cabat.


ROBOR drops to 2% 

The three-month ROBOR rate, which is used to calculate the interest rates of most RON-denominated loans, dropped yesterday to 2%, the lowest figure since November 14, 2017, according to the National Bank of Romania (BNR). The six-month rate reached 2.23%, the lowest level since November 16.


BNR to discuss deposit and Lombard rates in February 

The National Bank of Romania (BNR) has discussed a new narrowing of the monetary policy rate corridor and could come up with a decision that would tighten interest rates around the key rate at the February meeting, according to Governor Mugur Isarescu. BNR is under pressure to strengthen its monetary policy because the inflation rate has surged higher than expected.


BNR hikes key interest rate 

The National Bank of Romania's (BNR) board of directors decided yesterday to increase the key rate to 2%, the first increase in a decade. This is only the first such decision foreseen by analysts and it confirms the upward trend of interest rates. The trend started in September, 2017, when the money market was gripped by a liquidity crisis.


Legislative News (1)

Law 151/2015 - in force, but not applicable 

The personal bankruptcy law cannot be implemented because there are no specialized courts and procedure administrators. In theory, individuals can file for insolvency protection, but there are no courts that specialize in these cases. Insolvency firm CITR complained that the authorities have yet to set up local insolvency commissions.


Politics (2)

Tudose and Dragnea face off at party meeting 

Niculae Badalau, executive president of the Social Democratic Party (PSD), stated on Monday evening, at the end of the party's Executive Committee meeting, that the leadership's activity "has room for improvement". "The meeting was long, but not at all tense," said Badalau.


Magyar parties demand territorial and cultural autonomy 

UDMR, PPMT and PCM, the three parties representing Romania's Magyar minority, signed on Monday in Cluj-Napoca a joint statement harmonizing their autonomy concepts in order to back a common position in all future debates. The document features three types of autonomy - territorial, local and cultural - that the parties want to discuss with Romanian politicians in order to turn them into laws.