December 2 (SeeNews) - The Romanian leu firmed versus the euro on Wednesday amid calm trading, in tune with other currencies of emerging economies in the region, dealers said.
The leu opened at 4.2520/2540 per euro and ended at 4.2400/2420. On Tuesday, December 1, markets were closed as Romania celebrated National Day. The leu closed 4.2650/2680 per euro on Monday.
"The leu continued to appreciate slightly in line with other currencies in the region today. It seems there was an intervention by the central bank in the afternoon," one dealer told SeeNews.
The central bank does not comment on its foreign exchange operations.
The dealer said the leu may continue to appreciate slightly, but if the central bank stops intervening on the market the currency could lose ground.
"Improvement in economic fundamentals, sharp adjustment of the current account deficit, decrease in short-term external debt, the high level of interest rates and the expected support from the central bank should help RON to avoid depreciation. […] With the second round of presidential election to take place next Sunday, there are chances that the political turmoil will calm down," Raiffeisen Research said in its monthly Focus FX forecast.
Romania's central bank, BNR, set its reference exchange rate at 4.2496 lei per euro on Wednesday, compared to 4.2738 on Monday. For the U.S. dollar, the BNR set its reference exchange rate at 2.8157 lei versus Monday’s 2.8396.
Turnover on the interbank leu deposit market fell to 2.289 billion lei on Monday from 2.870 billion lei on Friday. The BNR will issue Wednesday’s turnover figures on Thursday.
Interest rates on overnight leu deposits were down to 8.17%/8.67% on Wednesday from 8.39%/8.89% on Monday.
Romania will hold a second round of presidential elections on December 6. The run-off will be crucial for the country, as the winner will name the country's next prime minister who will have to restart key reforms of the economy and the justice system in order to win back the trust of international lenders, a key condition for the release of the next installments of a 20-billion euro bailout package led by the International Monetary Fund (IMF).