Friday, March 28, 2008

Romania hikes interest rate to 9.5%

(MENAFN) Romania's central bank raised its main interest rate to a 31-month high and may choose to increase it again as inflation threatens to accelerate and the local currency weakens, AP reported.

The Banca Nationala a Romaniei increased its Monetary Policy Rate a half a percentage point to 9.5 percent, the Bucharest-based bank said in a statement. The move, the fourth consecutive increase, was predicted by most economists.

The bank has raised rates at every meeting since October to counter rising prices. Inflation in February was the fastest in two years as a drought boosted food prices and a weaker leu raised the cost of imports and services.

The inflation rate rose to 8 percent in February, the highest since March of 2006, from 7.3 percent in January and 6.6 percent in December, the National Statistics Institute said earlier this month.

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