Isarescu: I would never say we would not intervene on the forex market

The NBR (National Bank of Romania) has reaffirmed the fact that it can intervene on the forex market if needed, although it would prefer not to, after the RON gained almost 1.2% against the euro on Friday, in reaction to the interpretation, by dealers, of a news story from an international agency, where governor Mugur Isarescu allegedly stated that the central bank would not intervene to prevent the appreciation of the RON. “It is the right of any central bank to intervene when circumstances demand it, but the intention to intervene is only made public as a possibility: I can intervene whenever I like but I am not going to say whether I do it or not. An announced intervention could even be counterproductive. As a central bank, I reserve the right to intervene, but I will not say beforehand where or how,” Mugur Isarescu, governor of the NBR told ZF. On Friday quotes on the Bucharest forex market plummeted, falling from 3.2 RON/EUR to a five-year low of 3.16 RON per euro. The decline of quotes occurred amid huge foreign currency sales from foreign speculators, who acted in response to the news article published by Reuters. The agency published fragments of Isarescu’s statements made in Zurich to Market News International, reporting that the NBR would not intervene on the forex market, although Isarescu had said it “probably” would not intervene, unless the NBR became “seriously concerned” with the exchange rate’s progress.