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Bankers about the CCR decision: The political trouble must end. The leu will go on depreciati


The bankers and the local economists say that the CCR decision regarding the referendum is not sufficient for the economy to get back. The political turmoil will continue until the elections, the banks’ report shows, and the leu will continue its tendency to depreciate inspite of the interventions of the Central Bank. “ The politicians must understand the fact that any day of delay for this political scandal “ bites” from the “ economic growth” the financial analysts Florin Citu says.


”We continue to have the idea that this decision of the CCR will be followed by political fights and even more, this could lead to the weakening of the leu in the following months. Yesterday the leu was over 4,48 against the euro and on Thursday we could see the loss of the recent gains, the ING report destined to the clients says. “ A much waited for stability of the political situation would allow the Finances to issue bonds in autumn, which would be a positive news for the yields of bonds and for the exchange rate. We estimate a level of 4,55 lei/euro for December. BNR will try to defend the leu, to reach the inflation target, this being in danger of increasing the prices in food and the electricity price” a report made by BCR and sent to Viena on Thursday says.


Florin Citu, analyst, independent:” Unfortunately for the economy, the political tensions will continue. We are blocked from this point of view, and the politicians must understand the fact that any day of extension of the political scandal “ bites” from the economic growth. The leu will continue to depreciate, but not necessarily due to the political crisis but due to the weak economic fundaments. The trend to go down is given by these data. I would add that, as IMF said when they left Romania, the political volatility has effects on the real economy. Both the deposits of the population,the loans from the private sector, the lack of foreign investment and the outflows of capital show that today Romania is led by uncertainty. Moreover, since the beginning of the year the exchange rate went down constantly while the Hungarian forinz and the Polish zlot went up. This shows that no central bank can oppose the depreciation and we have outflows of capital. The real economy contradicts what the political class tells us, we live in a risky and volatile economy. This situation was presented since the beginning of the year and got worse over the last two months. But besides these visible effects there are effects for long periods of time on the real economy”


The Romanian currency was traded in a stable manner around the value of 4,49 against the euro over the last week, coming back to the levels at the beginning of July. We don’t see any other reason for the strong dynamics but a change of perspective on the part of BNR. The sum injected in the repo operations went down by one billion lei down to 4 billion this week. The instalments on the monetary market stay at high levels for this period of the month, and the ministry of finances rejected all offers at the most recent bid ( for the second time in August). The CCR decision wont’ send away the clouds on the political stage. In case Traian Basescu goes back in office, the tensions will persist, the political turmoil will make its presence felt until parliamentary elections. The recent appreciation of the leu might be blown away”,Raiffeisen Bank said in a report.