NBR moves 5bn euros of its reserve from deposits to bonds

The National Bank (NBR) increased its investments in bonds issued by foreign governments and organisations by a little over 20 billion RON (equivalent to around 5 billion euros) in April, while at the same time diminishing its deposits set up with foreign banks.
"The changes are of an operating nature and do not represent a change in our strategy of managing international reserves. We have three goals: safety, liquidity, and achieving a performance that suits market conditions," commented Mugur Stet, spokesman for the NBR.
The stock of bonds reached 87.6 billion RON (21 billion euros), with bonds consolidating their dominant position as an alternative for placement of international reserves. However, the volume of outstanding bonds fell by 17 billion RON, to 41.4 billion RON (10 billion euros).
This places the NBR in the paradoxical position of financing the US government and governments of EU countries with 21 billion euros, whilst on the local market the Treasury is seeking funding for its budget deficit, and is forced to pay high interest rates to commercial banks.