Romanian Central Bank (BNR) intervened in the banking market by bringing approximately 4.5 billion euros from its reserves since October 2008 until now, in order to diminish the exchange rate volatility, the World Bank shows in its Partnership with Romania Strategy.
The banking market has been unsettled in October 2008 by rumours regarding some commercial banks liquidities issues, which lead to an increase in interests. The interests stayed at a relatively high level due to a low risk appetite, an increasing aversion towards risk and a market fragmentation when the state titles eligible for BNR loans have been unequally distributed, the report reads.
World Bank economics shows that the leu depreciated 15% against the euro from October until now, because of the pressure to pay up debts. This lead to a pressure on the population and companies' debts and on banks' balance sheets.
To control the volatility of the exchange rate, the Central Bank openly interfered with the market, bringing approximately 4.5 billion euros from its reserves since October, the study goes on to show.
Since October 2009 until May 2009, when the first IMF money came in, BNR's currency exchange dropped monthly. In October, BNR's reserved read 27.31 billion euros, April figures read 24.88 billion euros. In May, BNR international currency reserves increased by 1.96 billion euros, reading 26.85 billion euros. But BNR's currency reserved dropped again in June, to 26.