September 28 (SeeNews) - The Romanian leu closed almost flat against the euro on Monday in a market strongly influenced by domestic political events and an upcoming monetary policy meeting of the central bank, dealers said.
The leu ended at 4.2020/2070 per euro, compared to 4.2000/2010 per euro on Friday.
Local analysts expect the central bank, BNR, to cut its monetary policy rate from the current 8.5% to 8.0% at its rate-setting board meeting due on Tuesday.
Romanian Prime Minister Emil Boc on Monday morning dropped Dan Nica as Interior Minister, deepening the rift between ruling coalition allies Democratic-Liberal Party, a centre-right formation, and the leftist Social Democrats, PSD, which took office in Romania following general elections held on November 30.
At the moment, the political situation in Romania is influencing strongly the leu and it will continue to do so over the next few days, one dealer told SeeNews. The leu traded between an intraday high of 4.2210 per euro and an intraday low of 4.1935 per euro, he said.
Boc also said on Monday that unless the PSD nominates a replacement for Nica over the next 24 hours, he will name an acting Interior Minister.
BNR set its reference exchange rate at 4.1953 per euro on Monday, compared to 4.2046 per euro on Friday. For the U.S. dollar, the BNR set its reference exchange rate at 2.8662 versus Friday’s 2.8625.
Turnover on the interbank leu deposit market rose to 4.368 billion lei on Friday from 2.920 billion lei on Thursday. The BNR will issue Monday’s turnover figures on Tuesday.
Interest rates on overnight leu deposits rose to 10.19%/10.69% on Monday from 9.18%/9.68% on Friday.