Romanian MPC stresses risks from loose fiscal policy

Romanian National Bank Governor Mugur Isarescu gave little away at this afternoon’s post-meeting press conference, but the tone of the accompanying statement suggested that the MPC is concerned about both deteriorating sentiment towards emerging markets and, more importantly, the impact of looser fiscal policy. As a result, while inflation is likely to stay negative for most of 2016, interest rate hikes later in the year seem more likely than not.