Wednesday, September 9, 2009

Romanian govt official says reappoint cbank gov

BUCHAREST, Sept 8 (Reuters) - Romania's central bank governor Mugur Isarescu should be reappointed to a second term in office, after his current five-year mandate expires in October, a top government coalition official said on Tuesday.

Mircea Geoana, who heads the government's left wing Social Democrats (PSD), told Reuters Isarescu was a 'natural choice.'

Under Romanian law, political parties have to present a list of potential central bankers, including the governor, to parliament's budget committees for discussion before the legislature gives a final approval to the bank's new board.Geoana said there was no agreement yet between the PSD and its ruling partners, the centrist Democrat-Liberals, and sources say official discussions have not started.

In recent months, Isarescu won praise from the International Monetary Fund, which has led a 20 billion euro aid package for Romania, for cautiously lowering borrowing costs at a time when the economy was shrinking sharply.

Early in his mandate, economists had criticised him for endangering the central bank's credibility, saying policy-makers had paid too much attention to foreign exchange levels when they introduced inflation-targeting in Romania.The central bank has declined to comment and Isarescu has not yet said whether he would seek a second term.

No comments: