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The National Bank of Moldova has kept the base rate applied to the main short-term monetary policy operations at the same level of 7.5% per annum

The National Bank of Moldova has kept the base rate applied to the main short-term monetary policy operations at the same level of 7.5% per annum

The NBM Executive Committee adopted such a decision at a meeting on Wednesday, leaving the interest rate on overnight loans at 10.5% per annum and the interest rate on overnight deposits at 4.5% per annum. In addition, the National Bank maintained the required reserves ratio for borrowed MDL funds and non-convertible currency at 42.5% of the settlement base, and the required reserves ratio for borrowed funds in convertible foreign currency at 17% of the settlement base. As noted by the NBM, the decision to maintain the previous value of the main monetary policy instruments was adopted after evaluating the latest macroeconomic data. In August 2019, the annual inflation rate developed in accordance with the forecast and amounted to 5.5%, remaining for the 4th consecutive month within the inflation target (5% ± 1.5 percentage points). As noted, thus, the NBM’s current inflation forecast remains valid, and inflationary pressures will continue until the end of this year. In 2020, inflation is expected to slow down as a result of lower dynamics in world food and oil prices and more moderate external and domestic demand versus the previous forecasts. The next meeting of the NBM Executive Committee on Monetary Policy is scheduled for October 30. It should be noted that at its previous two meetings of June 19 and July 31, the NBM Executive Committee decided to increase the base refinancing rate by 0.5 percentage points in both cases. So, from June 19, it was increased from 6.5% to 7%, and from July 31 - from 7% to 7.5% per annum. The National Bank of Moldova maintained the base refinancing rate at 6.5% per annum from December 5, 2017 to June 19, 2019. // 11.09. 2019 - InfoMarket.

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