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Depreciation of national currency, economic growth, according to analysts

The National Bank of Romania (BNR) cannot stop the trend of depreciation against the euro, despite more frequent interventions on the currency market, if the market's, the investors' conception towards Romania does not change, economic analyst Liviu Voinea, director at the Group of Applied Economics (GEA).

‘‘The investors perception of Romania has been positive over the past years, however now it is negative. The news from Romania is bad and the international context is unfavourable. Something has to be done to change their perception, therefore if measures such as the reduction of the benchmark interest and the reduction of the budgetary deficit are not taken, the BNR's direct interventions on the market can only slow down the depreciation or can stop it for a day or two,'' Voinea stressed. Analysts also caution against the significant slowdown of economic growth of Romania in 2008, considering a pace of 6.5 percent, as the authorities target through the Law on state budget, is no longer realistic in the current context of financial markets. ‘'If in the United States they are coping with recession, Europe is coping with significant slowdown, we should raise the same issue too. I already think that the fundaments on which the 2008 budget was built, are no longer compatible with the reality,'' economic analyst Liviu Voinea told Rompres. Voinea estimates Romania will have a much lower economic growth compared to the estimate, stressing that a level of 3 percent alone might be considered even good in the current financial and economic context. Economic analyst Ilie Serbanescu told Rompres that the grounds for the construction of the 2008 budget had been unrealistic and contradictory ever since the beginning, but now have become even more unrealistic. For 2008, the Romanian Government estimates an economic growth of 6.5 percent, which will prompt an increase in the GDP up to 438.6 billion lei (about 138 billion euros), an inflation of 3.8 percent and a current account deficit of 13.3 percent. Sursa: http://www.rompress.ro

Tags: economic percent depreciation romania growth euro bnr

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