September 29 (SeeNews) - The Romanian leu ended stronger against the euro on Tuesday following a decision of the country’s central bank, BNR, to cut its monetary policy rate from 8.5% to 8.0% taken at its board meeting earlier in the day.
The leu ended at 4.1850/1900 per euro, compared to 4.2020/2070 per euro on Monday.
The Romanian currency opened at about 4.2050/2080 and then eased slightly, one dealer told SeeNews. It then recovered following the central bank’s decision, he said.
Also on Monday morning, the BNR said it has decided to maintain the current ratios of minimum reserve requirements on both leu-denominated and foreign currency-denominated liabilities of Romanian banks.
Since the beginning of the year the central bank has cut the key rate four times: to 10.00% from 10.25% in February, to 9.5% in May, to 9.0% in June, and to 8.5% last month. Analysts expect further cuts to take the key rate below 7.0% by the middle of 2010.
BNR set its reference exchange rate at 4.1851 per euro on Tuesday, compared to 4.1953 per euro on Monday. For the U.S. dollar, the BNR set its reference exchange rate at 2.8701 versus Monday’s 2.8662.
Turnover on the interbank leu deposit market fell to 2.869 billion lei on Monday from 4.368 billion lei on Friday. The BNR will issue Tuesday’s turnover figures on Wednesday.
Interest rates on overnight leu deposits rose to 10.72%/11.22% on Tuesday from 10.19%/10.69% on Monday.