Wednesday, September 19, 2007

National Bank of Romania Today: Bloomberg Central Bank Watch

By Adam Brown

Sept. 19 (Bloomberg) -- The following is a summary of data released in Bucharest by the National Bank of Romania, the Finance Ministry and other government agencies.

Money Market:

The overnight interest rate on bank deposits, the most watched by investors, fell to 1.76 percent today from 3.16 percent yesterday. Interbank market trading dropped to 1.4 billion lei ($579 million) yesterday from 5 billion lei the day before.

The one-week rate dropped to 3.56 percent from 4.25 percent and the one-month rate fell to 6.01 percent from 6.17 percent. The six-month rate declined to 6.4 percent from 6.41 percent and the one-year rate fell to 6.43 percent from 6.44 percent.

The leu rose against the dollar to 2.436 yesterday from 2.446 the day before. It strengthened against the euro to 3.378 from 3.391, according to central bank data.

Government Borrowing:

The Finance Ministry sold 100 million lei of 10-year Treasury bonds on Sept. 6 at an average yield of 6.7 percent. The bid-to-cover ratio was 3.63.

Economic Indicators:

Romania's unemployment rate rose from a 15-year low in August as a drought that damaged most of the country's crops reduced the need for manual laborers to collect the harvest.

The rate rose to 3.9 percent in August from July's 3.8 percent, the lowest since 1992, the National Labor Agency said on its Web site on Sept. 17. Compared with a year earlier, unemployment fell from 5 percent.

Latest Comment:

The weakening of the Romanian leu and the effects of a drought in 2007 are the top risks to the central bank's inflation target for this year, the International Monetary Fund said.

``We will look at the question of exchange-rate development and see what impact that will have going forward,'' Juan Fernandez-Ansola, the IMF's senior regional representative, said in a meeting with journalists in Bucharest today. The IMF starts a week-long mission on Sept. 26 to review economic developments, and plans to make concluding statements in early October.

Cost of Money:

Overnight deposit rate: 1.76 percent.

The central bank's monetary policy rate: 7 percent.

The central bank's reference rate: 6.48 percent. The reference rate, published monthly, is calculated as an average rate weighted according to the total trading on the interbank market, interest rates on deposits and reverse-repo operations from the previous month.

To contact the reporter on this story: Adam Brown in Bucharest at abrown23@bloomberg.net .

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