The foreign currency reserves of the National Bank of Romania (BNR) decreased by EUR 1.73 bln in March, after they contracted by another EUR 1.22 bln in February.

However, the decline occurred after the European Union had transferred in December-January some EUR 3.75 bln to the accounts of the BNR - with the Government of Romania as the final destination under the Relaunch and Resilience facility RRF. BNR’s vaults were thus only used for the transfer of the funds to the final beneficiary.

At the end of March, the foreign currency reserves at BNR were EUR 40.1 bln. Compared to the short-term debt at the end of January (latest data available), this results in a coverage ratio of 80.7% - down from 86.7% in January and 82.3% at the end of December. 

Last month, EUR 2.92 bln entered BNR’s vaults, and EUR 4.65 bln came out, including the EUR 111 mln payment in the account of the Ministry of Finance.

Last month was marked by the Russian invasion of Ukraine and the volatility brought on the international financial and commodity markets.

The currencies of Central and Eastern European countries depreciated sharply in the last third of February and March, respectively, but the RON remained virtually unchanged, an evolution that analysts attribute to BNR market interventions.

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andrei@romania-insider.com