When the current government was installed I expressed my concern that with a Deputy Governor, in office, as Minister of Finance that the independence of the National Bank of Romania might be be in danger. Here is my opinion. Also here in Romanian.
Yesterday was a big day for the Romanian government. It is yesterday’s exchange rate from fixing that it would be used to calculate the excise taxes in Romania Simply put the higher the exchange rate the more money the government receives from this tax :the exchange rate risk stays with the common man.
I will get back to this exchange rate risk the government pushes on us without any opportunity to eliminate it. What I want to talk about is the exchange rate. It so happens that yesterday’s exchange rate was 5% higher than a year ago. Therefore just a simple depreciation fills the pockets of the Romanian government while implicitly increasing taxes on the economy.
If I were running a conspiracy theory blog I would say that the NBR did not intervene to help the Romanian consumer because the current Ministry of Finance who is also the Deputy Governor asked for this favor. This way it could increase government spending in the next few months and help his party win elections in December this year. BUT this is not a conspiracy theory blog.
All I am saying is this: do not be offended if people ask about a possible deal between the NBR and the Ministry of Finance at the expense of the Romanian tax payer when you create a situation which implies that such a deal is possible.