CHF climbed to a record 15.7 percentage against RON. National currency surpassed 4.5 units/euro threshold.
In a surprise move, Swiss National Bank (SNB) ended on Thursday its three-year-old cap of 1.20 franc per euro and reduced the interest rate on sight deposits, deepening a cut announced in December. This latest move marks an attempt by the SNB to reinforce defenses before government bond purchases by the European Central Bank. The franc jumped to a record against the euro and rose to its highest in more than three years against the dollar following today’s announcement.
The franc appreciated as much as 41 percent to 85.17 centimes per euro following the announcement. That is the strongest level on record, according to data compiled by Bloomberg.
The exchange rate announced by Romanian central bank for the Swiss franc rose on Thursday by 15.7 percent to RON 4.3287/CHF, a record level, and passed from RON 5 on the banking market quotations pegged to the euro. Also, the exchange rate for euro exceeded the RON 4.5/EUR threshold – RON 4.5034/EUR, the dollar also reached a record high against the national currency – RON 3.8510/USD.
“On the RON this move wasn’t very significant. On the Swiss franc was panic and was even stopped from trading. There were differences between bids and sales,” a bank dealer told to Mediafax. The transfer volumes on the local market were high, placing the transfers between a minimum at RON 4.4910/EUR and a maximum of RON 4.5032/EUR. In the region, the forint and the zloty have depreciated by 1.9 percent against the euro.
For 150,000 Romanians who have loans in CHF, taken during 2006-2008 period, SNB’s decision is staggering, because they counted that time on lower interest rates for the Swiss currency.
The impact of Swiss franc appreciation against the euro and, thus, of the national currency, is not major on Romanian interbank market and there is no way to significantly influence the NPL – non performing loans – level, given that only 4.5 percent of the loans in progress are in francs, and only 3.8 percent are owned by individuals, says the advisor to the governor of the National Bank of Romania, Adrian Vasilescu.