BUCHAREST – The Romanian national currency has fallen to a record low, with the euro trading at 5.1222 lei, down 0.45% from its previous rate of 5.0991 lei, according to the National Bank of Romania (BNR).
On Tuesday, the Romanian currency crossed the psychological threshold of 5 lei after the first round of the presidential elections, which was won by a far-right candidate, and the resignation of the government led by Social Democrat Marcel Ciolacu.
In an attempt to curb the currency's decline, the National Bank intervened in the market, which led to a noticeable increase in interest rates. The three-month ROBOR index rose to 7.25%, the highest level since January 2023.
Over the past few days, the Central Bank has spent at least 7 billion euros to stabilize the currency.
Despite attempts to soften his rhetoric and position himself as the “Romanian Meloni”, George Simion has so far failed to allay public and investor concerns.
Simion has announced plans to form a government consisting of the far-right AUR and POT parties if he wins the second round of the presidential election on May 18.
A poll released Wednesday showed Simion with 38.9 percent support, compared to Nikushor Dan's 31.3 percent. Another 14.7 percent of respondents were undecided and 8.9 percent refused to answer.
According to the Verified Institute, excluding undecideds and nonresponders, the results show Simion is on track to win 55.4% of the vote, while Deng is on track to win 44.6%.
The possibility of early elections has raised concerns in Romania's business community, as the process could take months, prolonging political instability.
Caretaker European Funds Minister Marcel Bolos said on Thursday that there were no discussions on a potential deal with the International Monetary Fund (IMF), adding that IMF involvement usually comes with “tougher reforms” than those outlined in Romania’s National Recovery and Resilience Plan.
He also expressed hope that the emotional reaction of markets and investors would soon subside.
Romania currently has the highest budget deficit in the European Union – 8.65% of GDP in 2024, up from 5.61% in 2023. The cost of servicing the public debt remains very high due to the country's weak credit ratings (Fitch: BBB-, S&P Global: BBB-, Moody's: Baa3).
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