The NBM reduced the base rate applied to main short-term monetary policy operations by 1.25 percentage points - from 6% to 4.75% per annum.
This decision was made by the NBM Executive Committee at a meeting on November 7. The National Bank also reduced interest rates on overnight loans and deposits by 1.25 percentage points - from 8% to 6.75% and from 4% to 2.75% per annum, respectively. It was also decided that the required reserve ratio applicable to funds raised in Moldovan lei and non-convertible currencies will be reduced, starting from the period of application of required reserves in Moldovan lei from December 16, 2023 to January 15, 2024, from 34% to 33% of calculation base. At the same time, the required reserve ratio applicable to funds raised in freely convertible currency will be reduced, starting from the period of application of required reserves in freely convertible currency from December 16, 2023 to January 15, 2024, from 45% to 43% of calculation base. As noted in the NBM message, thus, with the new decisions on monetary policy, the National Bank continues the easing of monetary policy that began at the end of last year. The goal of the NBM is to stimulate lending and support domestic aggregate demand, both by encouraging consumption and investment, balancing the national economy, and consolidating inflation expectations, with the aim of maintaining inflation within the target range of fluctuations in the medium term. The current forecast once again confirms the previously predicted disinflationary trends. The NBM emphasizes at the same time that the risks and uncertainties of the forecast have increased, especially in the context of tensions in the Middle East. Also from the external environment there are risks associated with energy prices, a decrease in economic activity in the eurozone, the war in Ukraine, the timing of monetary easing in the region and in the world, temporary shocks in supply and food prices. Herewith, internal uncertainties also arise, including tariff adjustments, the way in which compensation for energy resources during the cold season is reflected in statistics, the flow of refugees, weather conditions and the future harvest of agricultural products. In addition, at today's meeting, the NBM Executive Committee approved the Inflation Report No. 4, as well as changes regarding the interest rates applied when paying interest on mandatory reserves in US dollars and euros. The NBM stated that it will continue to monitor the inflation process, assessing the risks and uncertainties associated with it, and, if necessary, will propose the most effective measures to maintain price stability. The next meeting of the NBM on monetary policy will take place on December 14, according to the schedule. It should be noted that the last time the NBM changed the base rate applied to the main short-term monetary policy operations was on June 20, when it reduced it by 4 percentage points - from 10% to 6% per annum. At the next two meetings - August 9 and September 19 - it kept it at the same level.// 07.11.2023 — InfoMarket
