Romania issues EUR 5 bln FX bonds amid strong demand after fiscal package

Romania raised approximately EUR 5 billion on July 9 in its first FX bonds issued after the political normalization and the fiscal corrective package aimed at addressing its major fiscal slippage, amid reported robust demand. The country's borrowing cost, revealed by both the spreads in the FX bond issues and the yield for the 10-year local currency debt on the secondary market, have decreased after six months of political uncertainty.

The issue comes after the creditors assessed the fiscal package passed by the newly formed government of prime minister Ilie Bolojan as sufficient to avert sovereign downgrade this autumn. The package also convinced the European Commission not to take steps against the country whose public deficit hit 9.3% of GDP last year.