Credit-default swaps (CDS) to insure Romanian sovereign debt against default have increased to around 400 basis points in October, from 200-250 basis points in the first half of 2011.
Romanian President Traian Basescu said Sunday that the worsening economic climate in international markets, particularly in Greece, drove up Romania’s borrowing costs to higher levels than in 2010.
A similar situation is seen in Hungary, whose borrowing costs rose to over 500 basis points in October, from 250 basis points in June.
On Monday, Romanian credit-default swaps traded at 376 basis points, outside Bulgaria’s 330 basis points, but inside Hungary’s 511 basis points. Italy, feared to be the next victim of the sovereign debt crisis, traded at 446 basis points, while the cost to insure Spanish debt was 376 basis points.