The National Bank spent 0.5 to 1 billion euros of the foreignreserve in May alone in order to keep the exchange rate nailed to4.1-4.2 RON/EUR, as the international financial markets were shakenby the financial storm originating in Greece. This is theconclusion of ING Bank analysts, who say that the price of theinterventions might show in form of a higher volatility of the RONinterest rates over the coming months, which have already gone upfrom 2-3% a year to 6-7% in the last few weeks.
"Judging by historical standards, such a high volume of theinterventions on the forex market reveals heavy pressures for thedepreciation of the RON and that probably there is no more excessliquidity on the monetary market. Considering that banks probablybet on the depreciation of the RON, we expect a significantvolatility of interest rates soon, given that the NBR hasdemonstrated it prefers exchange rate stability," says NicolaeAlexandru-Chidesciuc, ING Bank's chief economist.
NBR on Tuesday announced that the foreign reserve had gone downby almost 400 million euros in May, to 31.9 billion euros.
