Romanian Ctrl Bk Gov Says Rating Agencies Were Right

"It’s obvious that rating agencies were right, but perhaps they sanctioned the country too harshly,” Isarescu said at the “Romania Financial Forum” seminar, organized by MEDIAFAX and the central bank.

Both Fitch Ratings and Standard & Poor’s downgraded Romania to "junk" last fall, while Moody’s is the sole rating agency that still places Romania in “investment grade.”

Isarescu said that in the last part of 2008, the problems were even more obvious, as all analysts claimed the wide external gap was not a result of investments, but of an overheating economy driven by exaggerated consumption and public spending.

On the other hand, the governor criticized once again "interested" analyses that see a risk of default for Romania, alongside other emerging countries, which have more severe problems.

"You will see that the next wave of negative examples about Romania will be on the too fast correction," Isarescu said.

On Wednesday, the governor himself said the current account deficit adjustment is excessive.

Romania’s current account deficit tightened 78.9% in the first four months of 2009 to EUR1.18 billion, from almost EUR5.6 billion in the same period a year earlier, due largely to a narrower trade deficit.