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Nov 07, 2007 15:22 EEST
BUCHAREST (Romania), November 7 (SeeNews) – The Romanian leu on Wednesday hit a new 2007-low against the euro as the worsening macroeconomic environment in the EU newcomer alarmed foreign investors, dealers said.
"It went beyond the 3.40 lei per euro threshold a little while ago, after opening at 3.3760/80. It's now [1256 GMT] traded at 3.4420 and the tendency is to depreciate even more, there is plenty of space for that", one dealer told SeeNews. "First it was the statements of the [central bank's] governor [Mugur Isarescu], and then came the Standard & Poor's negative outlook, so the trend is obvious," she said.
The leu has followed a descending trend after global rating agency Standard & Poor's revision of the outlook on Romania from stable to negative on Monday and the central bank's revised end-2007 inflation forecast earlier the same day. The BNR raised its annual inflation forecast for 2007 by 1.8 percentage points to 5.7%, beyond its target band, and has revised upward its end-2008 inflation projection to 4.3% from an earlier 3.7%.
The leu last traded cheaper on December 14 at 3.4400. It closed at 3.3750/80 lei per euro on Tuesday and 3.3670 on Monday
Romania joined the EU in January.
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