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The Romanian National Bank yesterday posted the lowest Leu-Euro exchange rate since January 2009, with the European currency dropping to 4.0801 lei. The last time the exchange rate dropped below 4.08 lei/euro, was on January 7th, 2009 (4.0729 lei).
Even though the exchange rate is still fluctuating below the 4.1 lei/Euro, bankers did not revise their estimates and say that these fluctuations are within the normal levels.
"The Romanian currency also gained during yesterday"s session, perhaps more than we were expecting, probably due to the fact that Fed did not provide any clues about the moment it would begin unwinding the current stimulus policies", the latest report issued by ING Bank analysts states.
The leu hasn"t traded in this range since the beginning of the previous month, and if it goes below the 4.07 lei/Euro, it will reach values that were last traded in 2008.
On the other hand, Raiffeisen Bank economists expect the leu to remain around the 4.1 lei/euro threshold, and to later appreciate to 4 lei/Euro.
"I don"t see major market fluctuations in the near future, the exchange rate will follow the current trend", considers Ionuţ Dumitru, the chief-economist of Raiffeisen.
Lucian Anghel, chief economist with the Romanian Commercial Bank, expects a wider range between which the exchange rate could move in the coming period, of 4 - 4.2 lei/euro, which he says would be the ideal range for exporters.
For the end of the year, BCR forecasts an exchange rate of 4.0 - 4.1 lei/Euro.
"It"s not the appreciation of the leu that is the issue, but rather the speed of these recent gains", Mr. Anghel said.
The Romanian National Bank yesterday announced an exchange rate of 4.0801 lei/Euro, down 0.20 bani from the Wednesday"s official exchange rate.
The national currency continued to gain on the international market, trading below 4.08 lei/Euro, ranging between 4.0780-4.0790 lei/Euro, at the end of the trading session.
• Euro dropping for fear Greece will not receive support from the EU
• Shares of Greek banks drop significantly
The Euro yesterday dropped significantly against the dollar, amid fears that Greece would not receive financial support from the European countries.
At 8:56 a.m., on the New York market, the Euro had dropped 0.5%, to 1.3675, from 1.3738 on the previous day. This year, the Euro lost 4.5% against the dollar.
Analysts say that the Euro is dropping as investors are becoming increasingly skeptical on the willingness of European countries to help Greece.
Prime Minister George Papandreou yesterday asked European Union leaders to lay the foundation of the emergency aid mechanism for his country, in a reunion which is scheduled to take place next week.
The Greek official yesterday said, in a discourse in the European Parliament: "We are not asking for money from Germany, France, Italy or from other taxpayers. What we are saying is that we need strong political support to make the necessary reforms, and to ensure that we don"t pay more than we should to implement these reforms".
The Greek PM wants European leaders to help lower Greece"s borrowing costs.
As markets are once again worried about the fate of Greece, shares of Greek banks dropped significantly. Shares of "National Bank of Greece" SA, the largest Greek bank, dropped 5.1% on the Athens market, to EUR 14.84. Shares of "EFG Eurobank Ergasias" SA, the second largest Greek bank, lost 6.5%, with a starting price of EUR 6.09. Shares of "Piraeus Bank" SA, the fourth largest Greek bank, dropped 6.1%, to EUR 6.03, and shares of "Alpha Bank" SA, the third largest Greek bank, lost 1.7%, to EUR 1.74.
The Athex index of the Athens Stock Exchange dropped 3.6%, to 2.015.08 points. (Alina Vasiescu)
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