Romania Holds Rates With Emergency Tax Hikes Set to Boost Prices

Romania’s central bank left borrowing costs unchanged as government efforts to rein in the ballooning budget deficit with tax hikes are likely to trigger a temporary spike in inflation.

The National Bank of Romaniaheld the benchmark rate at 6.5% on Tuesday, keeping one of the highest policy rates in Europe for a seventh meeting and matching the estimates of all economists in a Bloomberg survey.

With inflation running well above target, policymakers in Bucharest are confronting new risks to consumer prices from the planned tax changes needed to curb the European Union’s widest fiscal gap. Central bankers will ...