This situation is due to the financial crisis which led to a massive drop in orders for Romanian companies. Normally, a depreciation of the leu would favor exporters, but since the number of orders is dropping, exports are dropping as well.
Exporters warned lately that Romania’s trade balance could worsen significantly, and these warnings are already visible in statistics. The good news is that these drops have narrowed the trade deficit by more than one quarter (27 percent), which leads to a narrower current account deficit.
On the other hand, retail sales on the Romanian market soared by an annual 6.8 percent in November 2008, which maintains Romania in first place in the European Union for the sixth month in a row, according to Eurostat, the European statistics institute.
