Romania's central bank lowered its policy rate by another 25 basis points to 2.50 percent and narrowed its symmetrical rate corridor to plus/minus 2.25 percentage points from plus/minus 2.50 points. (This corrects earlier story that said the central bank cut its rate by 50 basis points)
The National Bank of Romania (NBR), which has now cut its rate by 275 basis points since starting an easing cycle in July 2013, added the narrowing of the corridor meant the rate on its Lombard lending facility would drop to 4.75 percent from 5.25 percent while the deposit rate would remain at 0.25 percent.
The NBR will release a full statement with the reason for its rate cut later today at a press briefing.
It did not change its minimum reserve requirements on banks' liabilities.
Romania's central bank last cut its rate on Nov. 4 when it also lowered its inflation forecast.
Romania's headline inflation rate eased to 1.3 percent in November from 1.4 percent in October.
The NBR said in November that it expected inflation in 2014 to end at 1.5 percent and 2.2 percent by the end at 2015, down, from its previous forecast of 2.2 percent and 3.0 percent, respectively.
On Nov. 6 the governor of the central bank said he would keep easing monetary policy by cutting the rate on banks' reserve requirements even if the NBR stops cutting rates.
On Nov. 4 the NBR cut the rate on banks' foreign currency liabilities to 14 percent from 16 percent while it maintained the rate on leu-denominated liabilities at 10 percent.
The NBR targets annual inflation of 2.5 percent, plus/minus 1 percentage point.