Briefing Romania
Wait-and-see mode
EUR/RON
Yesterday we saw quite low turnover on the FX market, which meant that the EUR/RON traded within a very narrow 4.7450-4.7480 range for most of the day. Thursday’s no-confidence motion is likely the 'wait-and-see' event which could induce some short-term volatility if it passes.
Government bonds
The Aug-2022 auction witnessed somewhat cautious bidding interest. The Ministry of Finance allocated its RON500 million target at 3.51% average and 3.54% maximum yields. Bid-to-cover wasn’t that great either, coming at 1.2x. Overall, the fixed income market is likely to turn more defensive ahead of the no-confidence vote.
Money market
Slightly surprising, the central bank’s deposit auction garnered RON4.9 billion in demand, suggesting that banks have a relatively comfortable liquidity position these days. Hence, we’ll likely see the front end hovering in the 2.00-2.50% range for the rest of the week.
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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