Briefing Romania

Much in line with previous trading sessions, the EUR/RON traded in a narrow 4.7620-4.7650 range. We expect sideways trading around 4.7650 for today and likely for the days to come as well.

It was a quiet trading day for Romanian government bonds, having only the Sep-2023 auction to enthral the market. As expected, demand was strong, with a 2.9x bid-to-cover ratio. The already traditional upsizing went a step further this time as the Ministry of Finance accepted RON792 million versus the RON500 million target at 3.86% average and 3.87% maximum yields. Overall, a strong result we’d say.

Cash rates look quite immobile these days, trading flat just below 2.50%. The central bank drained RON4.9 billion yesterday in its weekly deposit taking auction. The liquidity surplus looks comfortable enough to keep rates steady for the remainder of the reserve period.