Debt pressure on exchange rate

The amounts private companies have to repay in December against the loans taken from abroad will reach an all time monthly high and could influence the RON exchange rate, by making the domestic currency depreciate. According to data from the National Bank of Romania, the private foreign debt service will exceed 700 million euros in December, the highest figure seen so far. Then there are also the payments of 200 million euros against the public and publicly secured debt. The figures could be revised downwards, if some companies extend the maturity of their loans, but there is also the possibility of an increase due to the reassessment of the loans in dollars, which could lead to a total foreign debt service in December of nearly one billion euros. After a strong appreciation of the domestic currency in the first nine months, that is 10.2%, the RON started to gradually lose ground and the exchange rate stabilised at around 3.65 RON/EUR. The reversal of the trend was caused by the steps taken by the NBR, which limited the amounts attracted as part of the purging operations and significantly cut the intervention rate on the market. ZF