Romania might need to harshen its monetary policy to bring inflation on a downward trend and fit the central bank's target in 2009, representative of the International Monetary Fund (IMF), Albert Jaeger said.
- Publicitate -
IMF representative deems inflation could meet the central bank's target with help from the fiscal policy.
The central bank missed its 4 percent inflation target plus or minus 1 percent in December 2007. Currently inflation jumped over the 3.8 percent target for this year.
The central bank officials estimate annual inflation of 5.9 percent for December 2008, 1 percentage point over the 2.8-4.8 percent inflation target interval.
Annual inflation stood at 8.63 percent in March, hitting the peak of the last two years and two months. In reaction, the central bank hiked the key interest to 9.5 percent in March from 7 percent in October. Also, it sterilized aggressively the surplus of liquidity in the market to keep interbank interest rates at the key interest level.
IMF suggested the central bank to closely monitor the liquidity level on the market and harshen crediting conditions, especially on the the real estate sector.
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