Recent Updates
- Norway: International Reserves (Feb-Prelim)
- Denmark: Bankruptcies by Industry (Feb)
- Belarus: International Reserves (Feb)
- Estonia: CPI (Feb)
- Australia: Official Reserve Assets (Feb)
- more updates...
Economy in Brief
U.S. Initial Unemployment Insurance Claims Rise Just 9,000
Initial claims for unemployment insurance rose modestly by 9,000 to 745,000 in the week ended February 27...
U.S. Productivity's Decline Lessened in Q4'20; Reverses Q3 Increase
Revisions to nonfarm business sector productivity indicated a 4.2% decline during Q4'20...
EMU Unemployment Rate Steadies in January
The overall EMU unemployment rate was steady in January, off peak, but still elevated...
U.S. ADP Nonfarm Private Payroll Increase Disappoints in February
Job market strength moderated last month....
U.S. ISM Services Index Weakens in February
The ISM Composite Index of Services Activity declined to 55.3 during February...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Louise Curley April 18, 2005
On Wednesday, April 20, the central bank of Romania will issue new banknotes and coins of the new leu, which will become the legal currency as of July 1. One new leu is equal to 1,000 old lei.
Romania is one of a number of countries that have redenominated there currencies after they have tamed the inflation that had eroded the value of their currencies. Romania experienced three bouts of hyper inflation in the nineties--the first, producing an inflation rate as measured by the year-to-year percent increase in the consumer price index of 350% reached in March 1992, the second with a monthly peak of 309.7% in December 1993 and the third, with a monthly peak of 177.4% in June , 1997. The high rates of inflation led to continuing declines in the currency. The attached chart shows inflation, measured by the year-to-year percent increase in the consumer price index and the monthly exchange rate, Leu/US$, with the latter plotted on an inverted scale. Inflation in Romania has been declining slowly since early 2000 and has now reached 8.6% in March of this year.
A decline in the leu/US$ means that the dollar has depreciated against the leu or that the leu has appreciated against the dollar. (In the Haver data bases when the exchange rate is listed in terms of the foreign currency to the dollar, the percentage changes calculated are the percentage changes in the dollar relative to the foreign currency. In order to calculate the percent change in the foreign currency relative to the dollar, one takes the reciprocal of (1+the change in the dollar) and subtracts 1. For example the change in the leu/US$ from March 2004 to March 2005 was -14.99%, meaning that the dollar depreciated 14.99% against the leu or that the leu appreciated {(1/85.01)-1} or 17.6%.
Romania | Mar 05 | Feb 05 | Mar 04 | M/M | Y/Y | 2004 | 2003 | 2002 |
---|---|---|---|---|---|---|---|---|
Consumer Price Index (%Y/Y) | 8.63 | 8.92 | 13.09 | -0.19 | -4.46 | 11.86 | 15.36 | 22.51 |
Lei/US$ (EOP) | 28429 | 27473 | 33440 | 3.48 | -14.99 | -1082 | -2.70 | 6.02 |