Romanian Leu’s Reasonable Volatility Good For Economy – Ctrl Bker

"An excessive volatility is not beneficial. When the exchange rate advances, the prices don't move very much, whereas a depreciation (of the leu) is the first cause for price increases," Isarescu told a news conference on inflation.

The central bank's chief said the downward pressure on the exchange rate will ease this year compared with 2009.

Isarescu dismissed analysts' comparisons with the Polish economy, saying the situation in the two countries is different. According to analysts, the Polish authorities have allowed the zloty to depreciate against the euro, which made it possible for the country to register economic growth in 2009.

"We don't see a connection between the zloty's volatility and the economic growth. Poland didn't have to correct its current account deficit as we did (…). Their inflation was not like the one in Romania either," Isarescu said.

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