Isarescu: I think government approach is correct: we must see exact budget situation

The government approach is a correct one, because we must see first the exact situation of the budget, BNR governor Mugur Isarescu declared on Thursday at the annual conference of the Association of Financial-Banking Analysts of Romania. The governor explained we must end talks about the exchange rate, because any depreciation of the rate “is not good.”

He declared that another topic that should be approached  is that of increasing pensions and the decision in that case is political.

The BNR governor says the many other things should like financing should be solved, which is “difficult but not impossible.”

Isarescu mentioned that the government has an almost perfect buffer, but suggested that it is not advisable to use it when there is cash excess and that brings costs for the central bank and bankers.

“We must understand that we are in a difficult but controllable situation,” said the head of BNR, pointing out at the same time that we must sit down calmly, responsibly and professionally to build next year's budget, “which is more difficult to build.”

He showed that the foreign deficit of the private sector is financed autonomously and we must address government deficit if we want to reduce the foreign deficit, and a depreciation of the exchange rate does nothing but increase government deficit.

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