Briefing Romania
Central bank draining liquidity
EUR/RON
Low volatility and well below average turnover seem to be the main features of EUR/RON trading these days. For now, the pair looks stable in the 4.7550 - 4.7600 range. Medium-term, the only way for the EUR/RON seems to be upwards.
Government bonds
A very good Aug-2022 auction marked yesterday’s otherwise dull trading session in Romanian government bonds as London was closed. The Ministry of Finance sold RON872 million versus the RON500 million planned. Total bid-to-cover came out at 2.5x and yield-wise the auction met our expectations, at 3.94/3.95% average and maximum yields. Clustered demand, upsized allocation and mid-market yields, it was all in there for a successful auction.
Money Market
The National Bank of Romania (NBR) stepped in yesterday to organise a one week deposit taking auction, draining RON2.67 billion from 10 participants. This should keep cash rates anchored around the 2.50% key rate and signals the National Bank of Romania's commitment to its already announced “strict” liquidity control.
This publication has been prepared by ING solely for information purposes irrespective of a particular user's means, financial situation or investment objectives. The information does not constitute investment recommendation, and nor is it investment, legal or tax advice or an offer or solicitation to purchase or sell any financial instrument. Read more
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