UPDATE 1-Romania court rejects austerity measures – agency

* Some measures on pensions against constitution – Agerpres

* Savings required for resumption of IMF aid

* Leu currency and blue chip stocks fall

(Adds analyst and market reaction, details on politics)

BUCHAREST, June 25 (BestGrowthStock) – Romania’s top court rejected
some parts of a key austerity package related to pensions on
Friday, endangering an IMF-led aid deal, local news agency
Agerpres reported, citing judicial sources.

Disbursement of about 2 billion euros in aid from the
International Monetary Fund and the European Union depended on
the court’s approval of a government move to cut state wages by
a quarter and reduce pensions by 15 percent.

The 20-billion-euro IMF-led aid package is vital for the
recession-hit economy, and the court ruling hit the country’s
currency and stocks. The court said an official announcement
would follow shortly.

“This decision is a defeat for the government as it wasn’t
able to make a constitutional law,” said Mircea Marian,
political commentator at daily Evenimentul Zilei. “The letter of
intent will not reach the IMF board by June 28 for sure.”

“The government will not be able to take a decision until
the court explains the rationale behind its decision, which
could take at least 10 days…”

Romania’s leu fell after the decision was reported and was
down 0.6 percent on the day at 4.261 per euro by 0846 GMT
(EURRON=: ). The blue-chip stocks index also fell and was down 3.4
percent on the day (.BETI: ).

The reported court ruling raises further questions over the
government’s ability to push through reforms, after it narrowly
survived a no-confidence vote earlier this month, showing its
majority remained fragile. [ID:nLDE65E06I]

Stock Market Trading

(Reporting by Luiza Ilie, Sam Cage and Ioana Patran)
($1=.7453 Euro)

UPDATE 1-Romania court rejects austerity measures – agency