What Is RON (Romanian New Leu)?

RON is the abbreviation for the Romanian new leu, which is the official national currency of Romania. RON is the currency code used by traders in the foreign exchange market to represent the Romanian new leu. Circulation and valuation of the new leu is the sole responsibility of the country's 澳洲幸运5官方开奖结果体彩网:central bank, the National Bank of Romania or Banca Națională a României. Banknote denominations range from 10 to 500 lei. The new leu is divided into bani, which are denominated from one ban to 50 bani.

Understanding RON (Romanian New Leu)

The RON is the currency code for the Romanian new leu. The N in the currency code stands for the new leu, which replaced the old leu in 2005. The new leu is the official 澳洲幸运5官方开奖结果体彩网:national currency of Romania. As noted above, the country's central bank is the only institutio🐼n that can issue the currency.

Banknotes come in 澳洲幸运5官方开奖结果体彩网:denominations of 10 lei, 20 lei, 50 lei, 100 lei, 200 lei, and 500 lei. The bills are made of polymer rather than paper and come with security features like a transparent window and multicolored bands. The fractional unit is the ban, which is minted into coins. Coins come in the following denominations: one ban, five bani, 10 bani, and 50 bani.

The front of each banknote depicts an important figure from Romanian history alongside a plant. For example, the 500 lei note shows poet Mihai Eminescu and lime leaves with flowers. The reverse of the bill depicts the Iaşi University Library, an important building in Romania.

Though euros and U.S. dollars are often used and exchanged in the capital of Bucharest, the country's national currency is predominantly used to execute financial transactions.

RON (Romanian New Leu) in Forex Trading

According to XE, the RON is most commonly paired with the USD. To find out how many US dollars a single shilling will buy, divide one by the USD/UGX rate. As of December 2023, $1 is equal to around 4.49 RON.

Assume that the USD/RON rate is 4.25. This means it costs 4.25 Romanian new leu to buy one USD. If the rate increased to 4.75, that would mean the RON lost value relative to the USD. That's because it requires more RON to buy one USD. If the rate were to drop to 4.00, it would take fewer new lei to buy a USD, so the RON would increase in value.

History of RON (Romanian New Leu)

The new leu is the fourth in a series of currencies brought about through revaluations since 1867. It replaced the old Romanian leu in July 2005 at a rate of 10,000 old leu to one new leu. The trading symbol for the old currency was ROL, which was changed to RON once the central bank switched to the new leu. Both versions were used together during the conversion period from March 2005 until December 2006, at which point the old leu was phased out.

Throughout the leu's history, it has been pegged to the currencies of other nations, such as the German Reichsmark, the American dollar, and the Russian ruble. Though Romania is currently scheduled to adopt the euro as its primary currency in 2024, the leu is not currently pegged to the euro.

The Romanian new leu continues to recover from the global economic 澳洲幸运5官方开奖结果体彩网:recession🐈 of 2008 and the subsequent economic do༺wnturn in Europe.

Romania's Economy

Romania remains one of the European Union's poorest countries even despite its monetary and financial reforms. After the global economic downturn, Romania needed a $26 billion emergency aid package from the 澳洲幸运5官方开奖结果体彩网:International Monetary Fund (IMF) and Europe. Despite the assistance, the country's 澳洲幸运5官方开奖结果体彩网:gross domestic product (GDP) fell backward until 2011.

The country experienced 澳洲幸运5官方开奖结果体彩网:economic growth after the global downturn thanks to industrial exports and bountiful agricultural harvests. From 2016 to 2017, the 澳洲幸运5官方开奖结果体彩网:budget deficit shrank, and for the first time since the end of communism in 1989, Romania went through a time of 澳洲幸运5官方开奖结果体彩网:deflation instead of inflation. The deflationary period allowed the National Bank of Romania to loosen 澳洲幸运5官方开奖结果体彩网:monetary policy. According to the World Bank, Romania's gross domestic product (GDP) was $300.69 billion in 2022 at a growth rate of 4.6%.

The country joined the 澳洲幸运5官方开奖结果体彩网:European Union (EU) in 2007 but hasn't been able to meet the financial standards for becoming part of the eurozone. For instance, Romania could not meet the target of becoming part of the Exchange Rate Mechanism II by 2016. This means it had to delay transitioning to the euro with the goal of adoption in 2024.

The Bottom Line

RON is the code used in the foreign exchange market to identify the Romanian new leu, which is the country's official national currency. The latest version of the leu was adopted in 2005 and is poised to be replaced by the euro in 2024.