Many people are interested in forex trading in different countries. Well, in case you don’t have any experience with such type of trading it might be better for you to find some additional information on the country you intend to trade in.
However, let’s talk about Romania and its foreign exchange market. The currency of the country is Romanian Leu while at the same time here is another legal tender – the transferable ruble. It is now used as Mutual Economic Assistance balances.
First the Leu was aligned to the Ruble and this happened right after the World War II. In 1975 Romania intensified its economic relations with countries outside the capitalist regime and thus – various exchange rates were introduced and adjusted.
During the period from 1968 to 1990, there were 3 major exchange rates in Romania and those were – the basic rate which acted as basis for premium calculations, the commercial rate and the noncommercial/tourist rate for residents traveling to other countries. Major thing happened in 1990 because the above 2 and 3 exchanges were merged at a weekly adjusted Effective Rate, which is being linked to trade basket.
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As for the level of inflation in Romania, it used to be really high because of the foreign aids which aimed at removing the exchange control. This actually lead to the replacement of the Effective rate by an Interbank rate which was daily determined at a special fixing in the interbank foreign exchange market. Ever since then, the interbank rate is determined via daily auctions which are conducted by the NBR.
The National Bank of Romania is the main regulator of the country and every forex trader should be aware of this fact. Its main target is to keep the local currency stable and avoid higher level of inflations. However, the current situation of the country is more or less better than the old one because the GDP is higher than previous years.
The foreign exchange market in Romania is actually preferred by more risky players because sometimes the fluctuations of the markets are really intense and if you have experience you will be able to seize the moment and generate huge wins. Of course if you don’t have any experience, it would be better for you not to make any moves because you risk losing your money in no time.