WASHINGTON, May 4 (Reuters) - The Romanian economy is likely to shrink some 4.1 percent this year, the International Monetary Fund said on Monday, after approving a $17.1 billion stand-by loan to cushion the impact of global turmoil.
The loan is part of a 20-billion-euro package aimed at helping Romania, a new European Union member of 22 million people, ride out recession and prevent a financing crisis. The Fund also said it "broadly" agreed with the Romanian central bank's policy of smoothing out foreign exchange movements via intervention in the currency market.
"There is some room for intervention, it's not an unlimited room for intervention," Jeffrey Franks, the IMF's mission chief to Romania, said. (Reporting by Justyna Pawlak and Marius Zaharia in Bucharest; Editing by James Dalgleish)