UPDATE 1 - Romanian Leu Sinks vs Euro, C-Bank Remains Silent - Dealers

The Romanian currency reached 4.0000/4.0050 per euro in morning trade before briefly recovering to around 3.99 per euro by 11.30 a.m. (0930 GMT). Then, for the rest of the day it followed a depreciating trend in the absence of any support from the central bank and closed at 4.0735/4.0800 per euro, one dealer told SeeNews.

The leu closed at 3.9700/3.9800 on Wednesday, the last trading day last week before the Christmas holidays.

Dealers were expecting the central bank to support the leu on Monday as doubts about the ability of the country's new coalition government to tackle the economic crisis has made foreign investors cautious. traders said.

Romania's central bank, BNR, set its reference exchange rate, used for statistical purposes, at 3.9964 lei per euro on Monday, compared to 3.9649 lei on Wednesday. For the U.S. dollar, the reference exchange rate was set at 2.7923 lei versus Wednesday’s 2.8353 lei.

The leu was last quoted weaker in the BNR’s reference exchange rate at 40,259 per euro on November 12, 2004, central bank data showed. Romania slashed four zeroes off its legal tender on July 1, 2005.

Turnover on the interbank leu deposit market fell to 1.477 billion lei on Wednesday from 1.9 billion lei on Tuesday. The BNR will issue Monday's figures on Tuesday.

Interest rates on overnight leu deposits were set at an average of 13.97%/15.16% from 14.00%/15.28% on Wednesday.

Following are Monday's average bid and ask quotes of commercial banks on Romania's interbank market. They were calculated at 11 a.m. (0900 GMT) by the BNR, based on data provided by 10 commercial banks (in pct):