Briefing Romania

Despite the relatively higher turnover versus the previous day, the EUR/RON continued to trade narrowly just above 4.7300 where it also closed. We continue to see the pair gradually inching upward as bond inflows diminish and fundamentals continue to deteriorate.

A very quiet market ahead of tomorrow’s European Central Bank meeting. With no meaningful surprises from today’s inflation data (August CPI came in at 3.90% year-on-year against market consensus and our forecast of 3.80%) we expect the market to stay in wait-and-see mode today.

It’s business as usual on the money market. If anything, the curve has steepened a touch – normal in our view – but implied yields are still within a fairly tight range, from 2.45% at the front end to 2.90% at the back.