National Bank of Romania (BNR) Governor Mugur Isarescu said yesterday that the key interest is already high, thus anticipating a possible decision not to increase the monetary policy rate again in BNR’s next meeting.

The key rate repeatedly rose last year, up to 9.5 percent, in an attempt by the central bank to curb consumption which triggered higher inflation.

Isarescu tried to play down concerns by foreign analysts regarding Romania’s main macroeconomic indicators. Speaking of the current account deficit, he said that last year’s level, of 13.9 percent, should be the peak. The Governor ruled out a budget deficit exceeding the 3 percent threshold allowed by the EU’s Growth and Stability Pact.

According to Isarescu, prices will rise 5-6 percent by the end of the year, close to the level targeted by BNR.

His statements came on the heels of Fitch rating agency’s report downgrading Romania to the category of countries with the highest banking system vulnerability. According to Isarescu, part of the conclusions in the Fitch report are exaggerated. He gave as an example the liquidity shortage mentioned by the rating agency, saying that local banks are not presently facing this problem.

The Governor also said that, based on statistics, he plans to meet public notaries to discuss real estate sector prices, which he considers “scary.” Due to the fact that the real estate market in Romania is not regulated, notaries are in the best position to provide the real prices.