romanian central bank cuts key rate as recession lingers
News Posted On: 05 January 2010
Romania's Central bank has cut the key interest rate in a bid to increase growth in the economy and the real estate sector.
The interest rate was cut from 8% to 7.5% in the hope that Romania can finally start to emerge from the deep recession that is forecast to cause a 7% contraction in the economy this year, according to the International Monetary Fund.
Some will undoubtedly say that this is a little late in the game for such a rate cut, but one can hardly blame the central bank for enacting it, given the rebounds currently being enjoyed by many of its neighbours.
The interest rate cut may have a negative effect by decreasing the confidence of overseas investors, but that will hardly be the main concern given the depth of Romania's recession. On the other hand it is hardly a big enough cut to stimulate much domestic spending.
The recession is good news for overseas property buyers who can currently find some incredible bargains in Romania; the kind of bargains that yield 5-7% as buy to let investments.
View property for sale in Romania
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