In Brief
Romania’s leu advances to three-month high The leu advanced to a three-month high after Romania’s parliament approved a new prime minister, ending a two-and-half-month political deadlock that delayed bailout loans and put the country at risk of ratings downgrades. The leu strengthened 0.5 percent to 4.1974 per euros, the highest intraday level since September 30, as of 4.07 p.m. in Bucharest. It was the third-biggest gain among 25 emerging-market currencies tracked by Bloomberg. Romania’s parliament yesterday approved a government led by Prime Minister Emil Boc. The new cabinet must act within weeks to satisfy International Monetary Fund demands to stick to budget pledges. The absence of political leadership in the European Union’s second-poorest member delayed payment of part of a $30 billion International Monetary Fund-led loan and prompted Standard & Poor’s to warn the vacuum might trigger a credit-rating downgrade. «Now we finally have a government and the hope is they will get the IMF deal going,» said Koon Chow, an emerging-market strategist at Barclays Plc. (Bloomberg) Cyprus Airways to part with older Airbus Cyprus Airways Ltd, the state-controlled carrier, plans to sell one of its older A320 Airbus planes to Kyrgyzstan-based airline Eastok Avia. Subject to final agreements, Cyprus Airways will sell the short-to-medium range A320-231 for $6.1 million, the Nicosia- based airline said yesterday in a filing with the Cyprus Stock Exchange. Cyprus Airways, which is currently renewing its fleet, said on July 31 that use of its older planes had become unprofitable given their age. (Bloomberg) Pension bonus Bulgaria’s new center-right government yesterday approved Christmas bonuses for the poorest pensioners to try to ease growing discontent in the recession-hit economy. An end to 12 years of growth and rising unemployment has hit support for the government that won a July election by a landslide and now has to make sweeping budget cuts. The government decided to give 25 levs ($18.29) to 940,800 retired people whose monthly pensions do not exceed 200 levs. The bonuses will be paid in January, the cabinet said, as tight public finances do not allow for additional spending in 2009. The European Union’s poorest member state has been forced to cut public spending by 15 percent and put a freeze on salaries and pensions to avoid running a big fiscal deficit that may put pressure on its currency peg to the euro. Despite the efforts, Bulgaria will end the year with a fiscal deficit of 0.76 percent of GDP. The government plans an austerity budget for 2010, with spending cuts on almost all sectors ranging from education to health. (Reuters) Turkish loans Turkish bank lending may grow as much as 15 percent next year, according to Tevfik Bilgin, head of the country’s banking regulator. Loan growth accelerated in the past month, Bilgin told businessmen in Ankara yesterday. While total loans only expanded 1 percent to 377 billion lira ($245 billion) between October 2008 and the same month of this year, in the 41 days since the end of October, it grew 3 percent to 390 billion lira, he said. (Bloomberg)
