Romanian Leu Gains After IMF Mission Agrees on Accord ExtensionAndra Timu and Irina Savu
The Romanian leu gained for the first time in three days after an International Monetary Fund mission extended a review of the country’s loan accord by three months to allow time for the government to complete asset sales.
The currency appreciated 0.5 percent to 4.3735 per euro by 5 p.m. in Bucharest. Yields on Romania’s euro-denominated bonds due 2019 fell three basis points, or 0.03 percentage point, to 3.84 percent.
The IMF extended a review of Romania’s 5 billion-euro ($6.7 billion) precautionary pact until the end of June after Prime Minister Victor Ponta asked for more time to complete asset sales, Mission Chief Erik de Vrijer said in Bucharest today. The IMF board will meet in June to decide on Romania’s progress under the accord.
“The messages were in a positive tone,” Florentina Cozmanca, a Bucharest-based economist at Royal Bank of Scotland Group Plc, said in an e-mail today.
The leu has appreciated 1.7 percent against the euro this year, the best performance among emerging currencies in Europe, the Middle East and Africa tracked by Bloomberg.
The Banca Nationala a Romaniei raised a cap on funding for commercial banks via weekly repurchase agreements to 9 billion lei ($2.8 billion) yesterday, from 6 billion lei a week earlier. The central bank has restricted leu sales at its repo auctions since October to help prop up the currency.