Currency exchange rate: Leu hits record-low

Leu/euro currency exchange rate is not apparently alarming for BNR governor, Mugur Isarescu, who dropped hints on a possible further climb of European currency against leu, and in this case, National Bank will not intervene to support the national currency. “Do you think euro climbed too high?” Isarescu told the press.

National currency continued its downtrend through the end of the session, falling down to record highs, of roughly 4.18 lei/euro on a market with larger trading volume, the evolution of the leu influencing also the other emerging currencies in the region.

The highest exchange rate in the inter-bank market was in January 2004, of 4.1635 lei/euro.

“The local currency continued its fallout, with wide-bandwidth variation, and larger trading volumes compared to previous days. It is very likely for the depreciation in the region to be induced by the leu’s downslide”, said Ioan Birle, senior dealer of Banca Transilvania, quoted by NewsIn.

Leu was nearly 4.14 lei/euro in early trades, and after a slight increase up to 4.1080 lei/euro, it slumped anew near to 4.1760 units/euro record high. At 16:45, the banks were purchasing euro at 4.1655 and sell it at 4.1744 lei.

Boc-Isarescu meeting

BNR will shore up the government’s policies, in order to ensure an economic growth in 2009, as the adjustment of this year’s current account is inevitable, the governor said.

Mugur Isarescu did not disclose too many details on this year’s economic growth projections. However, his last statement on this issue showed a GDP growth between 3 and 6% in 2009.

“Adjustment of current account is inevitable in 2009 and we intend on conduct it without affecting the economic growth, inflation or living standards”, said Isarescu at the end of the meeting with Premier Emil Boc, where minister of finance, Gheorghe Pogea attended.

The government is taking into account a 3.5% economic growth for 2009, which will serves as support for budget projections, Ministry of Finance announced earlier this week.