RO Government borrows 55% above target from local banks in November

Romania's Finance Ministry borrowed RON 7.86 billion (EUR 1.6 bln) by issuing local currency-denominated debt on the local interbank market in November, 55.4% more than the planned RON 5 bln target, Mediafax reported.

It also issued EUR 2.5 billion Eurobonds and sold EUR 550 mln worth of local currency and foreign currency bonds to households.

Still, the Government avoided borrowing even more when refusing all the local banks' offers in the auction for foreign currency debt.

The issue took place after the successful and unannounced EUR 2.5 bln Eurobond issue.

Overall, the Government borrowed over EUR 4.6 bln or 2.3% of the country's GDP in only one month.

Romania's debt to GDP ratio edged up by 0.1pp in September to 42.9%, from 42.8% in August and 35.3% in December 2019.

Since the end of September, the Government issued the biggest ever euro-denominated bond on the local market, worth EUR 1.65 bln (0.8% of GDP).

Under the Fitch baseline scenario (9.5%-of-GDP public deficit this year), the general government debt to GDP ratio could reach 45.9% of GDP at the end of this year and 50.7% in 2022.

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