Euro reaches a new all-time high: 5.2788 RON, announced by the NBR on Wednesday

The euro reached a new record high against the Romanian leu on Wednesday, 23 September. The National Bank of Romania (BNR) announced a reference rate of 5.2788 RON per euro, up from the previous day's rate of 5.2647 RON/euro. On the interbank market, the euro rate climbed as high as 5.2792 RON.

How the exchange rate has moved recently

Wednesday's increase represents a rise of 0.0141 RON compared to the previous day's rate. The euro's appreciation has been gradual rather than sudden: at the end of August, the BNR had announced a rate of 5.2586 RON/euro, which had already reached 5.2647 RON/euro by 22 September.

Other currencies also strengthened

It was not only the euro that rose. According to the BNR, the US dollar increased on Wednesday to 4.6265 RON, up from 4.5934 RON in the previous session. The Swiss franc was quoted at 5.6205 RON, whilst the pound sterling reached 6.1442 RON.

An analyst links the trend to the political climate

Analyst Andrei Caramitru commented on the situation via Facebook, arguing that the leu's depreciation is linked to uncertainty surrounding the formation of a new government. He wrote that "the financial markets have revolted and are now taking action", referencing a presentation he considered unfavourable that was delivered in New York, as well as signals regarding the difficulty a potential reformist government might face in securing a parliamentary majority.

Caramitru also stated that the BNR may find itself in a difficult position with regard to supporting the leu, and identified the 5.30 RON/euro threshold as the next level being watched by the market. It is important to note that these statements represent the analyst's personal opinion, and not an official position or forecast from the BNR.

According to him, yields on government securities have risen, and selling pressure on Romanian assets is said to be high. Caramitru further suggested that a potential government led by Mureșan could be formed, implying that pressure from financial markets might influence political decisions.

What to watch going forward

Breaking through the 5.27 RON/euro level places the exchange rate in uncharted territory, and 5.30 RON/euro is viewed by market participants as a significant threshold to watch. The actual trajectory of the exchange rate will continue to depend on currency supply and demand, capital flows, and the broader economic and political context in the period ahead.