WARSAW: Romania's leu extended gains early on Tuesday after a failed referendum took the heat out of a domestic power struggle, while other emerging European currencies eased as a global rally built on anticipation of central bank stimulus measures flagged.
Assets across the region have risen on hopes that the European Central Bank and possibly the US Federal Reserve will soon announce bolder measures to tackle the global economic slowdown.
Expectations of ECB action at its meeting on Thursday have boosted the euro, emerging Europe's main reference currency.
In Romania, the country's prime minister failed on Sunday to oust its president in a referendum, easing tensions with the European Union and the International Monetary Fund, which is supplying aid that the country needs to shield itself from the euro zone crisis.
By 0716 GMT, the leu was 0.2 percent higher at 4.557 to the euro.
"We expect the EUR/RON to be around 4.50 by the end of 2012 under the assumption that the political backdrop will improve following the November elections and concerns over the implementation of the EU-IMF program will fade away," analysts at Citi wrote in a note.
The IMF is expected to start a sixth review of Romania's aid programme this week.
Other emerging European currencies lost ground. Poland's zloty shed 0.1 percent to trade at 4.114 per euro. The Czech crown and Hungary's forint both eased 0.2 percent.
"I would bet on 4.10 on the zloty (to the euro) now, and if it breaches this level, the next key target is 4.08 its one-year high," said one Warsaw-based dealer.
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