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CFA Romania: the depreciation of the leu is normal: probably in the future the leu will be depreciated at the same rhythm, of 2- 3% per year
The national currency recorded a slight depreciation over the last week, but his phenomenon is a natural one as the currency in the region is depreciated, stated on Wednesday the chairman of CFA Romania, Adrian Codirlasu.
‘We had a slight depreciation over the last week, which is natural. We have on the one hand the shock in the region, the whole region is depreciated. But, against the region, Romania is not right about the twin deficits. We have the biggest deficit for current account, as the countries in the region have excess, and we have the biggest budgetary deficit, as the countries in the region have a relatively balanced budget. What is worse, is that these deficits are estimated to grow in the future both by local analysts, and the IMF and the European Commission. As a result, these deficits must be financed inclusively by foreign debt, thus by foreign loans, which means that there will be pressure on the depreciation of the leu. Probably, in the future, the leu will be depreciated at the same rhythm as before, somewhere at about 2-3 percentage per year’ said Adrian Codirlasu who took part in the conference ‘ New interests on the monetary market’.
According to him, the depreciation is supported by the inflation, with a difference of inflation between Romania and the euro zone.
Asked if this year we could see pressure on the exchange rate and when the depreciation trend is over, he mentioned that the depreciation of the leu was extremely small,as other currencies get a higher depreciation every day and it is possible to continue the growing evolution of the rate euro-leu.
On Thursday, the euro exceeded the level of 4.85 lei in some commercial banks, after, on the interbank market, the euro passed the level of 4.78 lei, above the reference rate announced on Wednesday by the National Bank of Romania (BNR) .