The pro -European candidate Nicusor Dan He overturned the forecasts and confirmed that he won the elections in Romania, as the remaining votes were not sufficient to give Simon a lead.

As expected, the initial reaction of markets after the opening was positive, and the investment climate against Romanian assets has improved significantly. Lai has reinforced more than 1.5% against the euro and now negotiates slightly lower than the pre -election levels. The Bet raised more than 3.5%, while the ten -year bond yield fell short to 7.4%, fully deleting the rise that occurred after the first round of voting. Most importantly, the risk of downgrading of credit rating has been significantly reduced.

Fears of political instability, EU removal and abandonment of tax increases – mostly alarming as Romania records the highest fiscal deficit in the EU – were among the main concerns after Simon’s dynamic appearance in the first round. Combined with political turmoil, fiscal difficulties have led the country to the brink of downgrading its credit ratings in “rubbish”, which would have significantly increased the cost of borrowing.

Although Dan’s victory is an important message, the president himself has limited powers. The next decisive step for Romania will be the appointment of the Prime Minister, with Ilie Bolozan being considered the most likely chosen of Dan. Bolozan is a central-liberal reformer known for his pro-Western attitude. The crucial point seems to be described as a fiscal prudence politician, prioritizing fiscal discipline and effective public spending.

The reaction of markets clearly shows that investor concern has declined significantly. However, forming a new government and tackling the financial deficit are particularly difficult challenges. Therefore, Romanian assets will be closely monitored and, in the event of obstacles in the above areas, may continue to be under pressure.