October 14 (SeeNews) - The Romanian leu closed nearly unchanged against the euro on Wednesday amid political uncertainty a day after the country’s minority government lost a no-confidence motion, dealers said.
The leu ended at 4.2900/2950 per euro, compared to 4.2920/2960 per euro on Tuesday.
The Romanian president was expected to nominate a new head of government later on Wednesday.
The leu opened near the 4.3-per-euro mark and went on to depreciate in early trading, weighed by political uncertainty, before rebounding later in the day, one dealer told SeeNews. “It is possible the central bank may have intervened on the market," the dealer said. The other currencies of emerging markets in the region strengthened today amid global appetite for risk, he said.
Romania’s central bank, BNR, does not comment on its foreign exchange operations.
“While the recent political developments should exert additional pressures on the currency, we believe that the BNR is likely to remain active in the FX market to prevent a sharp deprecation of the leu. […] Since the political situation is unlikely to improve before early next year, the leu is expected to remain under pressure going forward,” Citibank said in its Emerging Markets Daily report on Wednesday.
The BNR set its reference exchange rate at 4.2940 per euro on Wednesday, compared to 4.2897 per euro on Tuesday. For the U.S. dollar, the BNR set its reference exchange rate at 2.8812 versus Tuesday’s 2.9008.
Turnover on the interbank leu deposit market fell to 2.161 billion lei on Tuesday from 2.513 billion lei on Monday. The BNR will issue Wednesday’s turnover figures on Tuesday.
Interest rates on overnight leu deposits fell to 9.87%/10.37% on Wednesday from 9.89%/10.39% on Tuesday.