October 13 (SeeNews) - The Romanian leu closed weaker against the euro on Tuesday after the country’s minority government earlier in the day lost a no-confidence motion floored by the opposition over its performance, dealers said.
The leu ended at 4.2920/2960 per euro, compared to 4.2800/2850 per euro on Monday.
The motion was filed earlier this week by two opposition parties, the National Liberal Party and the Democratic Union of Hungarians in Romania.
After the vote in Parliament against the government of the Liberal Democratic Party, the leu firmed to 4.2890 per euro in fairly modest volumes before easing a bit later to 4.2950 which was still below the official reference exchange rate, one dealer told SeeNews. “It is not impossible the [central bank] BNR may have intervened on the market but as the volumes were low we cannot be sure that this was the reason [for the leu’s short-lived appreciation]," the dealer said.
BNR does not comment on its foreign exchange operations.
“I don’t expect that the BNR will let the leu depreciate too much in the next few days,” the dealer said.
“[…] we might see increased pressure on the local currency and maybe a spike in rates,” ING Bank said in its daily note to investors.
The BNR set its reference exchange rate at 4.2897 per euro on Tuesday, compared to 4.2840 per euro on Monday. For the U.S. dollar, the BNR set its reference exchange rate at 2.9008 versus Monday’s 2.9078.
Turnover on the interbank leu deposit market edged down to 2.513 billion lei on Monday from 2.548 billion lei on Friday. The BNR will issue Tuesday’s turnover figures on Wednesday.
Interest rates on overnight leu deposits fell to 9.89%/10.39% on Tuesday from 9.97%/10.51% on Monday.