Romanians move their savings in hard currencies on lower confidence in RON

Romanians have steadily moved their savings from RON accounts into hard currency accounts since the beginning of this year, a trend that could be associated with lower confidence in the local currency following the steep depreciation registered in January, according to fresh central bank data, according to Business-Review.eu.

Bank deposits in RON have become less attractive during the last couple of years as a consequence of low – and real negative – interest rates, currency depreciation and high inflation rate.

In June, RON-denominated deposits of residents (individual clients and companies) declined by 0.6 percent month-on-month to RON 220 billion and the annual growth rate slowed to 5.1 percent, from 6.8 percent in December 2018, central bank data show.

Forex-denominated deposits rose by 1.5 percent month-on-month in June to RON 116.9 billion-forex equivalent, and by 12.9 percent year-on-year.

During the last couple of years, Romania’s bank clients increased their creditor status against banks due to strong savings and weak credit market, deposit holders being technically the banks’ creditors.

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