March 3 will mark the end of the 12-year reign of the dollar at the National Bank of Romania (NBR). The foreign currency, which Romania has used to do its sums for years is now stepping down to make room for the euro, set to become the benchmark for calculating the ROL exchange rate.
"Starting the first business day of March, NBR will buy and sell euros, instead of dollars, on the forex market whenever it intervenes. I will no longer talk about GDP/capita calculated in dollars, but in euros," NBR governor Mugur Isarescu on Wednesday said.
The USD exchange rate will be calculated according to the ROL/EUR rate and to the EUR/USD rates on the international markets from that moment on, while commercial banks will have to calculate statistical data in euros instead of dollars in their reports.
Isarescu says this step might favour exporters, who collect most of their revenues in euros and would allow for a higher predictability of the exchange rate, as well as help curb the inflation, given that the real ROL appreciation objective still stands.
The dollar leaves the stage at a bad time for the American currency, but the head of the central bank says this has nothing to do with the moment chosen to change the benchmark for the ROL exchange rate.
Isarescu grounds this decision on the strengthened position of the euro in Romania's foreign business relations in 2002, the prospect of Romania's being invited to the join the EU in 2007 and the express request of the European Central Bank. This request was prompted by the fact that Romania and Lithuania are the last of the applicant states not to have embraced the euro as benchmark for their domestic currencies.
The dollar on Wednesday lost substantial ground to the euro on the international markets. The exchange rate reached 1.0935 USD/EUR. The ROL/USD rate in Bucharest was quick to go down below 33,000 ROL/USD reaching 32,977 ROL/USD, the same as six months ago. The euro went up, reaching 35,993 ROL on Wednesday.
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