Romanian economy affected by stronger USD

The RON has been fast to lose ground to the American dollar over the last few weeks, amid negative investor sentiment due to the European debt crisis, which could expose Romanians to price hikes, primarily in the case of fuels.

The US dollar climbed to a fourteen-month high at the end of last week, crossing the 3.32-RON mark and seeing a 6.5% rise this month. Since the beginning of 2010, when it amounted to 2.9 RON, the American currency has gained around 13%. But the appreciation seen of late is circumstance-driven, dealers say – the investors’ concern over the European debt crisis and the improved American economic performance. The euro has in turn lost more than seven percent to the American dollar in the last month.

“The fact that macroeconomic figures published of late are better in the United States than in Europe has led to a recent strengthening of the dollar. A contributing factor is Europe’s debt crisis,” a bank dealer commented.