The central bank set the leu’s reference rate against the euro at 4.639 on Friday (November 10), after the national currently officially topped the 4.6-unit mark versus the euro on Wednesday (Nov 8) and then fell to 4.6267 against the euro on Thursday (Nov 9).
The leu had previously hit a record low of 4.6397 against the euro during the week July 23- 27, 2012.
The leu has recently depreciated amid tensions over the government’s plans to overhaul the tax system and signals from the central bank that it would allow more flexibility in the exchange rate.
Last Thursday, central bank governor Mugur Isarescu said the leu was on an extended depreciation trend, unlike regional peers, and the currency is under pressure due to the country’s ballooning trade deficit.
In its meeting last Wednesday, the Romanian Government passed an emergency decree that includes controversial tax changes which would come into force starting January 1, 2018. The measures include the transfer of social security contributions from employer to employee, cutting the income tax to 10% from 16% and lowering the social security contributions by 2%.
The three-month ROBOR index, used to calculate interests on loans in lei with variable interest, jumped to 1.89% on Monday (Nov 13), from 1.87% on Friday (Nov 10), central bank data showed Monday. The six-month ROBOR index, which is used to calculate interests on leu-denominated mortgage loans, rose to 2.06%, from 2.03% on November 10.