NBR policy rate stays at 6.50%. BCR expects no cut at least until May 2027

The National Bank of Romania kept its monetary policy rate at 6.50% a year at the 8 October 2026 meeting. Ciprian Dascălu, BCR's chief economist, expects the rate to remain unchanged at least until May 2027.

These are two different reference points.

The first is an official decision. The second is a market scenario that depends on inflation, the exchange rate, fiscal policy and economic activity.

What the NBR decided on 8 October

The NBR board kept the policy rate at 6.50%, the lending facility at 7.50% and the deposit facility at 5.50%. Minimum reserve requirements were also left unchanged.

The policy rate has stood at the same level since August 2024, following two reductions during that summer.

Economists had expected the decision, so it did not surprise the market.

Annual inflation fell from 8.16% in July to 6.17% in August, according to National Institute of Statistics data cited by the central bank. The pace remains well above the NBR target.

The decline is visible, but it does not show that price pressures have disappeared.

The NBR still sees risks from energy, fuel, commodities, the exchange rate and fiscal policy. Electricity prices after the end of the price-cap mechanism partly explain the still elevated inflation profile.

Why Ciprian Dascălu points to May 2027

Ciprian Dascălu believes the NBR policy rate could remain at 6.50% at least until May 2027. The main argument is persistent core inflation, which may return to the central bank's target range only in the fourth quarter of 2027.

This is a BCR scenario, not a timetable announced or endorsed by the NBR.

BCR's scenario puts inflation at 6.4% at the end of 2026. A weaker leu and commodity prices create a risk that the forecast may be revised towards 6.9% if autumn data exceed expectations.

Dascălu estimated annual inflation of 6.6% for September.

The official figure, expected around 13 October, will show whether price pressures eased or the more cautious scenario gained weight before the next NBR forecast.

Early 2027 or after May?

The NBR governor said in August that a rate cut could be considered after inflation fell below the policy rate. That condition could emerge at the beginning of 2027.

This was not a promise of a cut.

The governor described a condition for opening the discussion. BCR forecasts no reduction at least until May, without claiming that the first cut will necessarily happen in that month.

The next Inflation Report, due after the 12 November meeting, should present the central bank's revised price path and assumptions.

The leu changes the inflation equation

BCR estimates that the recent weakening of the leu may add about 0.3 percentage points to inflation. Under the same scenario, scope for another substantial depreciation would be limited.

The analysis also suggests a possible shift in the NBR's reaction. Interest-rate stability may receive more weight than exchange-rate stability, with somewhat greater flexibility for the leu. This does not mean abandoning the managed exchange-rate regime.

For a borrower paid in lei, the connection is direct. A weaker currency makes imports more expensive, can delay disinflation and narrows the room for a rate cut. Daily movements are available on the euro-leu exchange-rate page, although a one-day change should not be treated as a trend.

What this means for IRCC, ROBOR and loans

The NBR policy rate does not directly change every monthly loan payment.

IRCC is calculated from interbank transactions and reaches loan contracts with a delay. The current IRCC page shows the applicable value, quarter and indicative payment effect. ROBOR responds more quickly to liquidity and inflation expectations, while a ROBOR and IRCC comparison must include the bank margin, fees and refinancing costs.

An unchanged policy rate makes a rapid, broad decline in borrowing costs less likely.

Banks may still run promotions. Offers should be compared using APR, total repayment, insurance, fees and post-fixed-period terms for the same amount and duration.

For a mortgage, the difference between the initial rate and the later formula can materially alter the cost. The mortgage simulator tests payments at several interest-rate levels before an application is submitted.

A weak economy limits the risk of a rate increase

A stagnant economy does not favour another rate increase. Weaker domestic demand and a negative output gap reduce price pressure even while core inflation remains persistent.

Romania has already entered a technical recession, and the World Bank forecasts a 0.5% contraction for 2026. The context is covered in the analysis of Romania's GDP in 2026.

That combination explains the current impasse: the economy provides reasons for lower rates, but inflation does not yet allow a quick move.

What data could change the scenario

The first check will be Romania's official September inflation figure.

The November Inflation Report, budget execution and the exchange rate follow. Faster disinflation and credible fiscal adjustment could bring a cut closer to early 2027. Adverse surprises may extend the period without reductions beyond May.

For now, 6.50% is the official level. BCR expects it to remain unchanged at least until May 2027; it does not say that the first cut must occur then.