The FX Market Outlook for 2025 indicates that the US dollar is expected to maintain its strength, bolstered by robust economic performance in the United States. Analysts predict that the EUR/USD exchange rate could peak at 1.05, influenced by various external factors [65999e0e]. In contrast, the EUR/RON exchange rate is projected to remain stable, as the National Bank of Romania is anticipated to continue providing liquidity to the market [65999e0e].
Despite these positive forecasts, Romania is grappling with a significant budget deficit, estimated at approximately 7% of GDP. This fiscal challenge may necessitate a seven-year adjustment program to stabilize the economy [65999e0e]. Furthermore, moderate interest rate cuts are expected in 2025, reflecting a cautious approach to monetary policy amid ongoing economic uncertainties [65999e0e].
Alin Latu from iBanFirst emphasizes the importance for Romanian companies to prioritize currency risk management in light of these developments. The global economic landscape remains precarious, with rising protectionism and economic sanctions posing threats to growth, affecting nearly one-third of countries [65999e0e].
In the context of the previously reported Currency Outlook for Q4 2024, iBanFirst had highlighted that the Romanian economy is projected to grow by 2.7% in 2024, supported by public investment and private consumption. However, inflation is expected to stabilize around 5%, with the central bank's target of 4% not likely to be reached until 2026 [8e5aed42][f223f50b].
Overall, while the outlook for the dollar remains strong, the stability of the EUR/RON pair will depend on the National Bank of Romania's actions and the broader economic environment, which includes addressing the significant fiscal deficit and managing inflationary pressures [65999e0e].