Tuesday, January 9th

Romania’s potential government reshuffle postponed

Romania’s prime minister failed in his attempt to reshuffle the government on Monday as Liviu Dragnea, the leader of the governing left-wing Social Democrat Party (PSD), said that any such changes had to wait until the end of the month. A similar reshuffle was expected in October last year after the forced departure of two ministers facing corruption charges. Prime Minister Mihai Tudose had himself threatened to resign during a dramatic six-hour meeting of the governing PSD party’s executive last year, but got the resignations of the two ministers in the end, according to reports. Some sources mention growing tensions between Prime Minister Tudose and Mr. Dragnea.

Romania’s central bank hikes rates

Romania unexpectedly raised borrowing costs for the first time in almost a decade as inflation bounces back and its economy expands at one of the continent’s quickest paces.
The bank raised the rate by a quarter of a percentage point to 2 per cent on Monday as the increase underlines the strength of the economic recovery in central and eastern Europe while also reflecting fears of overheating. Romania’s National Bank (BNR) Governor Mugur Isarescu said the bank expected inflation to increase beyond its target range of between 1.5 per cent and 3.5 per cent in the first half of this year. “We increased the key rate because of inflation and because we want to anchor inflationary expectations from the start,” Mr Isărescu told a press conference in Bucharest. “If you fail to act in due time, expectations don’t tend to be anchored and we wanted to avoid that.” “While the decision comes as a surprise, the central bank is trying to get on the curve very fast,” Ciprian Dascălu, a Bucharest-based economist at ING Bank NV, told Bloomberg by email. “This is positive for the leu and Romanian debt.”

Romanian president expected to approve nomination of a new minister

Romania’s President Klaus Iohannis is expected to approve the nomination of Ioan Deneş as new minister of water and forest on Tuesday. Mr. Deneş will replace Doina Pană, the former minister in the field who resigned last week for health reasons. A former member of the opposition centre-right National Liberal Party (PNL), Mr. Deneş became a member of the governing left-wing PSD in 2014 turned currently a senator representing the Romanian county of Bistriţa-Năsăud. He is known for his homophobic remarks leading to protests of the LGBT community before PSD headquarters in the capital Bucharest last April.

Romanian unemployment at 4.7 percent

Romania’s seasonally adjusted unemployment rate fell to 4.7 percent in November of 2017, from 4.9 percent in the previous month, according to data released by Romania’s National Institute of Statistics on Tuesday. It was the lowest jobless rate on record as the number of unemployed went down by 8 thousand to 443 thousand. The unemployment rate and the number of unemployed are disseminated on a monthly basis as provisional data and they are subject to quarterly revisions as new information becomes available. The unemployment among men was 1.9 percent higher than the rate among women.

 Alexandru Danga