Pressure on the RON intensifies

The euro has gathered pace over the last few days and, despite all supposed interventions of the NBR (National Bank of Romania) to temper the exchange rate, the RON/euro exchange rate rose to 4.24 RON/euro yesterday in the second half of the trading session, the highest level since the beginning of the year.

Nerves are running high again for clients with euro-denominated loans, risks of a new wave of price hikes have emerged, with the American dollar - which sets the tone for fuel prices - at a 3.55-RON all-time high.

The single European currency has hit a six-month high, with the rate displayed by the National Bank in mid-session reaching 4.2180 RON/euro. The euro climbed almost 13 bani (100 bani - 1 RON) against the Friday level, when it had managed to cross the psychological 4.2-RON mark for the first time since January. In the second half of the session, the European currency continued to appreciate, with the European Central Bank, which collects the data later than the NBR, calculating a 4.2359 RON exchange rate.

Under the circumstances, analysts of local banks have changed their forecasts on the progression of the exchange rate for the coming period, expecting depreciation pressures to continue over a longer period amid a prolonged recession and in the context where fiscal adjustment measures will be rather difficult to implement.