Moldova: starting January 2, the EUR becomes the base currency for setting the official exchange rate of the MDL instead of the USD
The National Bank of Moldova (NBM) recalled that this decision reflects the orientation of the Moldovan economy towards the EU market, which plays a dominant role in the country's trade and financial structure. It is emphasized that this transition is aimed at adjusting to the economic realities in a context in which the European Union is Moldova's most important trade partner and the main source of remittances and foreign direct investments. According to official data, more than 60% of commercial transactions and 70% of remittances are made in EUR, and this currency is the most popular on the local foreign exchange market. According to the NBM, this change will reduce the fluctuations of the MDL exchange rate against the EUR, as well as the difference between the EUR buying and selling rates, which will benefit the economy and help reduce currency exchange costs. Similarly, the use of the EUR as a base currency is a methodological decision designed to bring the financial structures of Moldova in line with the EU structures, without affecting the monetary policy of the NBM. Citizens and economic agents will not be directly affected, as the transition is of a technical nature and its objective is to maintain the macroeconomic balance and compliance with European standards. However, citizens will benefit from the stability of the EUR/MDL exchange rate, lower exchange rate risk and lower transaction costs, which is an important aspect for people who receive remittances or have loans in EUR. As for the business environment, lower exchange rate volatility will facilitate financial planning and reduce risks in commercial transactions with EU partners. The NBM emphasizes that the banking sector and economic agents will also benefit from a more liquid EUR/MDL foreign exchange market and lower transaction costs. It is worth mentioning that Moldovan President Maia Sandu welcomed the NBM's decision to switch to the EUR as the base currency for setting the official exchange rate of the MDL. “This confirms Moldova's economic orientation towards the European Union, will benefit foreign trade by facilitating financial planning for exporters and investors, ensuring greater predictability of international trade operations. This decision will bring more clarity and stability to Moldovan companies exporting to the European market. The currency exchange costs will be reduced and businesses will be able to plan investments and commercial operations with more confidence,” Moldovan President said. President also said that Moldova aims to become part of the Single Euro Payment System (SEPA) in 2025, which will facilitate fast and cheap transfers between Moldova and European countries. // 02.01.2025 - InfoMarket.
