Hungarian and Bulgarian bonds rank second and third, respectively, with yields of 10.7 percent and 7.2 percent.
Prices of Romanian bonds dropped significantly in the past few months, due to the need for liquidity of owners and the deterioration of economic conditions. The bond rate of return varies indirectly proportional to their price.
“Yield is an expression of the way investors perceive risk, and Romanian bonds are bearers of the highest interest rates in the region in national currency,” the Chief Economist of Banca Comerciala Romana (BCR), Lucian Anghel, told Business Standard.
Moreover, investors are cautious about the state budget. “We believe the budget deficit will be five percent of GDP [gross domestic product]. The main problem in 2009 is related to budget revenues, which could be subject to strong pressures,” added Anghel.
