Leu Sharply Dn, After Romanian Pres OKs Wage Hike For Education Employees

"After Basescu’s statement, euro grew in short time from RON3.68 to RON3.7250," a banking dealer said.

At around 1050 GMT, the Romanian leu was traded at 3.7200/3.7250 units against the euro.

Romanian president Traian Basescu approved on Friday a 50% wage hike for education system employees, a law that the government warned would jeopardize economic stability.

Early October, the Romanian Parliament adopted a 50% wage increase for education system employees. Following the decision, the Government contested the law at the Romanian Constitutional Court, but the Court decided the law was constitutional.

Mid-October, Tariceanu said such an increase cannot be supported financially and would trigger a major crisis in the Romanian economy.

The leu opened at RON3.5960/RON3.6000 to the euro, higher compared with Thursday’s closing value at RON3.6065/RON3.6150 against the euro.

The central bank computed an indicative of RON3.6875 against the euro, the leu being 2% weaker than Thursday’s value.

On the monetary market on Friday, interest rates were at 14%-17.80%.