Romania

Romania is set for a period of political uncertainty following the shock victory of liberal Klaus Iohannis (pictured) in a presidential election on Sunday. With 96 per cent of the votes counted, Iohannis was in the lead with nearly 55 per cent, an unexpected triumph over Prime Minister Victor Ponta of the ruling Social Democrats (PSD).

Ponta will now face calls to stand down from the premiership, even though he has said he is determined to stay on as Romania prepares to draw up its 2015 budget, paying for a pre-election splurge. Read more

Romania’s latest interest rate cut – to another all-time low – comes after a sharp slowdown in growth, but further easing will have to be weighed against the political outlook and the government’s likely parting of ways with the IMF.

The National Bank of Romania (BNR) cut its key rate 25 bps to 3 per cent on September 30, while reducing its minimum reserve requirements two percentage points to 10 per cent. The latter is expected to increase market liquidity by around 3.6bn leu ($1bn) from October 24, according to a note from BCR, Romania’s largest commercial bank. Read more

Negligible inflation and a desire to maintain exchange rate stability in spite of capital inflows were the key factors prompting Romania to cut interest rates to an all-time low, analysts said on Tuesday.

On August 4, the National Bank of Romania (BNR) reduced its key policy rate to 3.25 per cent from 3.50 per cent. Reuters quoted Governor Mugur Isarescu as telling reporters that more easing was possible. “There may be further (easing) space but, this time, we’d be forced to take decisions taking into account the external environment to a greater extent,” Isarescu was quoted as saying. Read more

An attempted murder in a bar brawl; a president under siege after the arrest of his brother and son-in-law on graft charges, having already survived two referendums on impeachment – Romanian politics may be messy but it is rarely boring.

For the economy, though, it is business as usual. And perhaps the fact that the law can reach even those closest to the country’s most powerful man is a positive development for a country once seen as a byword for corruption. Read more

Central and Eastern European local currency bonds lifted following a widely-anticipated move by the European Central Bank to cut key interest rates in a bid to anchor the eurozone’s tentative economic recovery.

The confirmation of cheaper money across the continent sent investors searching for riskier assets, further pushing down yields on Turkish, Hungarian and Polish bonds which have rallied over the last month. Read more

As the European Central Bank (ECB) teases investors with hints of monetary stimulus measures, expectations of a rate cut are already helping boost appetite for emerging market debt on the continent.

Yields on Hungarian forint bonds dropped yesterday following a heavily oversubscribed bond auction, and since the start of the month Polish and Romanian local currency bonds have also rallied. Read more

A Romanian investment fund originally set up by the government to compensate people who had their assets confiscated under communism will seek to list in London, in an ambitious move that could boost investor access to Romanian equities.

Fondul Proprietatea (“the property fund”) could complete a secondary listing on the London Stock Exchange by the end of the year, its institutional administrator Franklin Templeton said this month. Read more

Five per cent GDP growth is these days more associated with the fittest Asian and African emerging economies than the sluggish EU fringe, but Romania has sprung a surprise with its Q4 2013 figures, its best for five years.

A flash estimate from Bucharest’s National Institute of Statistics on February 14 suggests that the economy grew by 5.2 per cent year-on-year in the final quarter of last year. This takes its full-year rate to 3.5 per cent, among the fastest in Europe and appreciably above a recent IMF forecast of 2.8 per cent. Meanwhile inflation, once a serious concern, fell to an all-time low of 1.1 per cent in January. Read more

In recent weeks, much has been made of Romanians’ desire to leave their country and work abroad, partly due to the weakness of Romania’s own economy. On Wednesday, the country’s central bank made an ambitious move that may help that economy, the second poorest in the EU, by cutting rates to a record low and easing reserve requirements. Read more

Maybe it’s time to start preparing for a return wave of CEE migrants from western Europe, as Thursday’s flash GDP third quarter numbers show that most of the region’s economies are experiencing a sharp recovery – in contrast to stagnation in the eurozone. Read more

It was the biggest initial public offering in Romania’s history, and the latest of several big IPOs in eastern Europe. But will Friday’s part-privatisation of natural-gas utility Romgaz reinvigorate Romania’s stalled liberalisation programme? Read more

Hollywood, Bollywood, Nigeria’s Nollywood; France’s arthouse cinema scene, British romcoms, Italian and Russian film from the likes of Fellini and Tarkovsky; the Korean Wave. The cinema culture of south eastern Europe may be rather less celebrated outside the region than those of its more famous peers, but there is growing recognition both of a resurgent home-grown movie scene and the competitive advantages of SEE as a location for shoots. Read more

A lot of recent numbers indicate that central Europe’s economies have turned the corner and are starting to rebound after a slump late last year and in the first months of 2013.

More data buttressing that case came in over the last few days. In Poland, new car registrations in September were up by 16.5 per cent at 24,963 cars – that’s 13 per cent higher than in August. Read more

Romania’s interest rates have hit a record low, but will it be enough to revive its flagging economy?

As central banks in some developed markets seem to be gearing up for tighter monetary policy, Romania’s announced a third consecutive interest rate cut on Monday, citing falling inflation, and with an eye on sluggish growth. Read more

By Lucian Anghel, chairman of the Bucharest Stock Exchange

The Bucharest Stock Exchange, or BVB, has never played a big role in Romania’s economy; nor has it been the focus of much international attention.

But, after a period of turbulence, during which the country has suffered political storms and frenetic general elections, that could all be about to change. Read more