Midday Forex: Leu roars to one-year high

The National Bank of Romania is keeping short-term monetary interests to as low as 3.5-4%, in an effort to head off an aggressive appreciation of the leu, and set a reference rate of 4.1167 lei/euro, the lowest rate in a year.

The local currency hasn’t been that strong against its European counterpart since January 7, 2009, when the central bank set a rate of 4.0720lei/euro.

The reference rate set by the NBR on Friday is 0.3% below Thursday’s level of 4.1286 lei/euro.

The leu showed modest gains in the morning, and at 13:45 it was trading at 4.11lei against euro.

“The decision to leave interest rates at low levels can be used to head off an excessive and fast-track appreciation of the leu in the forex market”, a dealer told NewsIn.

The emerging currencies in the region moved in the opposite direction today, with the Polish zloty falling from 4.03 to 4.04 units/euro, and forint dropped from 266.66 units/euro to a reference rate of 267.42.

For the US dollar, the reference rate set by the National Bank of Romania grew 0.54% to 2.8609 lei/dollar from yesterday’s 2.8454lei/dollar.

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