Foreigners' deposits in RON reach historical high

Deposits in RON made by foreign clients in domestic banks reached a historical high of 5.12 billion RON (1.49 billion euros) last November. Speculative players’ confidence in the region’s emerging markets has been the catalyst behind the record high surge. The RON proved even more attractive than currencies of neighbouring states, because of the high interest rates on the local market. Non-resident clients (excluding the foreign banks) increased their deposits in the domestic currency by more than 710 million RON, equal to 16%, in November alone. Foreign clients’ deposits in RON saw more than 2.3-fold rise in value last November compared with the corresponding period of 2005. The foreigners’ enthusiasm for the local market has also been reflected by the exchange rate, which has been spiralling downwards since last autumn, after several months of stability. As a result, the national currency closed 2006 riding the crest of a wave, unlike previous years when seasonal imports were responsible for “autumn-winter depreciations”. Last December the EUR/RON exchange rate reached the lowest point since autumn 2002, under pressure from substantial capital inflows.