At the beginning of the week, the price of a gram of gold reached a record of 333.3834 lei. It lasted only one day, the price increasing on Tuesday to 336.2958 lei, an evolution due to the appreciation of the American currency and reaching a historical maximum of 2,266.85 dollars/ounce.
The yellow metal’s upward trend is due to increased demand from central banks, especially China, but also from the commercial sector. On the other hand, investors anticipate the start of the process of reducing monetary policy interest rates by the US Federal Reserve, the ECB or the Bank of England after the Swiss National Bank was the first to take this step, at the end of March, by cutting the reference rate from 1.75 to 1.5%.
At the same time, the yellow metal is considered a “refuge” in periods when geopolitical risks have increased (the war in Ukraine, the possibility of expanding the conflict in the Middle East or the rising tensions in the South China Sea).
Euro quotations in the local market rose marginally on Tuesday to 4.969 – 4.972 lei, which raised the rate of the single currency from 4.97 to 4.9705 lei.
Two days before the NBR’s monetary policy meeting, the ROBOR indices stagnated at the values of the beginning of the year. The three-month rate, according to which interest is calculated on most loans in lei contracted before May 2019, stagnated at 6.05%. The 6-month index, used to calculate mortgage rates, consolidated at 6.07% and the 12-month index at 6.08%.
The re-opening of western markets, after the mini-holiday for the Catholic celebration of Easter, depreciated the euro to $1.0724 – $1.0748, the peak being reached in the second part of the day after the March drop in US consumer prices to 0.3%. In the local market, the rate of the American currency rose from 4.6047 to 4.6276 lei, the maximum of the last month and a half.
The American currency maintains its growth potential against the European one. According to analysts, the Federal Reserve could operate a benchmark rate cut of 0.75% this year. Instead, an ECB official said the institution would cut the policy rate by a total of 1 percentage point, which will make the dollar much more attractive.
The exchange rate of the Swiss franc depreciated to 5.0930 lei and that of the pound sterling to 5.8148 lei.
In the region, the average of the Hungarian currency appreciated marginally to 395.26 forints/euro and the Polish currency strengthened to 4.2934 zlotys/euro, the lowest of the last four years.
On March 11, bitcoin hit a high of $73,797, but fell to $65,075 on Tuesday, confirming the risks facing cryptocurrency investors. In turn, ethereum fell as low as $3,282.
RADU GEORGESCU
Photo source – Ziua de Cluj
