December 28 (SeeNews) - The Romanian leu fell on Wednesday to its lowest level against the euro since August 2012, central bank data showed, as political tensions heightened after election winners PSD threatened to seek the suspension of president Klaus Iohannis over his refusal to appoint their candidate for prime minister.
Romania's central bank, BNR, set its reference exchange rate at 4.5409 lei per euro on Wednesday, down 0.1% from 4.5363 lei per euro on Tuesday.
The leu changed hands between 4.5344 and 4.5432 against the single currency during the trading session, according to real-time interbank forex trading data published by local portal Conso.ro.
The last time the Romanian currency traded cheaper was on August 3, 2012 when BNR set its reference exchange rate at 4.6481 lei per euro. On December 21, the leu hit a 6-month low of 4.5309 per euro, down 0.3%.
Romania's currency lost 0.25% against the dollar, trading at 4.3504 by Wednesday noon, BNR data indicated.
On Tuesday, the leader of the Social Democrat Party (PSD) Liviu Dragnea said that in the next couple of days the government coalition would decide whether they will come with a new proposal for prime minister or they would seek the suspension of president Klaus Iohannis who rejected their candidate, Sevil Shhaideh.
The government coalition of PSD and centre-right Liberal-Democrat Alliance (ALDE) was also considering an option to create a parliamentary commission to determine whether the president's decision violated the constitution or not, the PSD leader added.
Under Romania's constitution, an incumbent president who severely violates the constitution may be suspended in a joint session of the two houses of parliament. If a suspension motion passes, a referendum for the impeachment of the president shall be called within no more than 30 days after the suspension.
Iohannis said earlier on Tuesday that he wouldn't appoint Sevil Shhaideh as prime minister and asked the government coalition formed after the December 11 election to propose a new candidate.
After the president accepts a nomination, both the prime minister and the new cabinet must be approved by parliament. The MPs can reject a proposed government up to three times before the president decides to dissolve parliament and call new elections.
In mid-December, Iohannis said that the integrity criteria for local politicians remain valid in the process of appointing the new prime minister. The integrity criteria made it impossible for PSD leader Liviu Dragnea to become Romania's new prime minster because he had been issued a two-year suspended jail sentence for a referendum fraud in 2012.
In a comment on the political situation in Romania, Raiffeisen Bank analysts said on Wednesday that given the latest developments, the chances to form a government before New Year have diminished considerably.
Banca Transilvania analysts noted that the climate in international markets and domestic factors, including the Romanian president's decision to reject the candidade for prime minister were influencing the financial market.
(1 euro=4.5409 lei)
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