It is just a coincidence?

There is one relationship among economic variables that works well over time in Romania: M1 and the EURRON. I am not sure why this holds as the NBR is officially targeting inflation not the exchange rate. I guess officially this is  just a coincidence (spurious relationship.).


4 thoughts on “It is just a coincidence?

  1. Euroisation. The key word that explains the chart: NBR blames the euroisation as a phenomena, practicing it as a policy.

    1. We know that. The question haunting economists is this: the EURRON-M1 relationship is a consequence of the Inflation Targeting monetary policy or it is the monetary policy and the inflation outcome is a consequence?

  2. Ca BNR a marit masa monetara in 2008 pentru a impiedica o supraevaluare a leului inteleg…. Nu cred ca economiei i-ar fi priit un curs de 2,50 lei/Euro… (suna amuzant). Efortul de a scoate leii de pe piata banuiesc ca si-a avut rolul in a tine cursul in frau.
    Nu a costat asta economia mai mult decat decat daca ar fi permis un curs mai liber? Sau beneficiul este ca am scapat de “socuri”?

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