Snaps
25 July 2019

Briefing Romania

Nothing but the ECB in sight

Romania_in_Europe.jpg

 - Source: Reuters
Source: Reuters

EUR/RON

The monthly payments to the state budget generated additional selling interest in the EUR/RON along with the already familiar bond inflows. The pair tested below 4.7200 but failed to consolidate lower. We continue to see 4.7200 as a strong support for EUR/RON.

Government bonds

Romanian government bonds had a very good day again, the long end receiving solid inflows and dropping around 15 basis points. A dovish ECB today will likely support further buying interest along the curve.

Money market

Cash rates tightened for the period covering the beginning of the current reserve period, trading above 3.00% up to the 1W tenor. Once the dust settles over today’s budget payments we should see rates coming towards or even below the key rate again.

 - Source: Reuters, ING estimates
Source: Reuters, ING estimates