"Whether you think you can or think you can't, you are right." - Henry Ford

FOREX MARKET
Today, yen lost some of the recently posted gains, as investors turned back their attention towards higher yielding currencies. The greenback extended its rally against the euro up to 1.3070 zone, although there were no major data to support this evolution. Therefore, we see this downward move of the pair as a temporary correction, and expect the rebound of the euro later this week, probably in the proximity of ECB's monetary policy meeting on March 8th. Today, the market watchers will be following the US factory orders and home sales figures.
On Monday, the single currency was bided higher at 3.4030 level at the opening of the domestic forex session, as some off-shore investors decided to cash in profits from emerging markets. This upward move was determined by the reduction in the risk appetite of investors, due to the recent drops in global equities. However, the euro could not maintain the gains, as the initail purchases were offset by sustained sell-off, keeping the pair rangebound in the 3.3950-3.4000 area for most of the trading.
On March 6th, the Romanian forex market opened at 3.3920 level, but shortly after sustained sell-off drove the pair until 3.3850 zone by noontime. The recovery of the domestic currency was in line with the course of its regional peers today, as investors might be reconsidering their exposures in the emerging markets.
Romania's gross domestic product expanded by a robust 7.7% y/y in real terms during 2006, according to the preliminary data released today by the National Institute for Statistics. Romania's economy speeded up its growth rhythm as compared to last year's performance of only 4.1%, amounting to RON 342.4bln (some EUR 97bln) vs. RON 287bln in 2005. In Q4 2006, the GDP rose by 7.7% y/y, outpacing by far performance of 4.3% posted in the same timeframe in 2005. Romania's GDP grew far above the initial expectations and previous year's performance, but below the latest forecasts, as the economy seems to have eased some of its previous upsurge in the last quarter of 2006.

MONEY MARKET
The short term interest rates stood flat in the 7.5/8.5% zone on Tuesday, although NBR continued the partial sterilization. Yesterday, NBR drained 35% of the overall offer of commercial banks, amounting to RON 1.76bln at the 8% fixed policy interest rate.