Longest-Serving Central Bank Chief Gets New Term in Romania
(Bloomberg) -- Romania’s Mugur Isarescu extended his tenure as the world’s longest-serving central bank governor after receiving approval from lawmakers for a new five-year term.
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A majority of legislators backed a nine-member central bank executive team led by Isarescu, Speaker Daniel Suciu said on Tuesday. During hearings before the main parliamentary vote, the 75-year-old governor vowed to continue fighting one of the highest inflation rates in the European Union, while also maintaining leu stability as a managed floating currency.
“I am confident that inflation will gradually fall back inside our target range of between 1.5% to 3.5% in the coming months and our objective is to achieve that without triggering a recession,” Isarescu told lawmakers in Bucharest.
Isarescu took over the leadership of the National Bank of Romania in 1990, less than a year after the collapse of Nicolae Ceausescu’s communist regime, and has served for over three decades except for a yearlong stint as prime minister in 1999 and 2000.
The board’s line-up was slightly shuffled with Deputy Governor Leonardo Badea taking over the first deputy role from Florin Georgescu, who will remain a deputy governor. Cosmin Marinescu, economic adviser to President Klaus Iohannis will be the new deputy governor, replacing Eugen Nicolaescu.
The mandates of existing members Cristian Popa and Csaba Balint were renewed, while Aura Socol, an economics professor, lawmaker Roberta Anastase and Alexandru Nazare, a former finance minister, join the board for the first time.
In an acknowledgment of his unusually long tenure, Isarescu said Romanian law doesn’t formally stipulate term limits and that new members are necessary to bring change.
“Only myself and Deputy Governor Georgescu remain as veteran members, and it’s our duty to ensure that there are younger members at the bank who’ll get enough time to learn the complicated ropes of monetary policy,” Isarescu said.
The central bank holds its next monetary policy meeting on Oct. 4, which will be the last decision of the current board as the new team should take over from mid-October. Some analysts surveyed by Bloomberg see room for more cuts in interest rates this year from the current 6.5% as inflation is set to decline to 4% at the end of the year.
(Updates with final vote in parliament from first paragraph, comments from Isarescu in 7th and 8th paragraphs.)
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