The NBM has kept the base rate applied to the main short-term monetary policy operations at 6.5% per annum
This decision was adopted by the Executive Board of the National Bank of Moldova (NBM) at its meeting on May 12. The NBM also left unchanged the interest rates on overnight loans at 8.5% per annum, on overnight deposits at 4.5%, and on repo operations at 6.75% per annum. As noted in the National Bank's statement, with the decision adopted on May 12, it intends to limit inflation expectations, return and keep inflation within ±1.5 percentage points of the inflation target of 5% in the medium term. The NBM's decision was made against the backdrop of contained inflationary trends and the spread of previously adopted restrictive monetary policy measures. The National Bank also took into account delays in the transmission of previous decisions, the effects of which will still be felt in the near future. The NBM noted that inflation will tend to decline until the end of the year, driven by domestic aggregate demand, which will be below potential. At the same time, domestic economic activity and inflation continue to be affected by the consequences of supply shocks, in particular due to the increase in regulated tariffs in the last two quarters and the decline in agricultural production under the influence of unfavorable weather conditions. In addition, disinflationary effects may be caused by negative global demand as a result of the trade conditions imposed by the US. The NBM stated that it will continue to closely monitor the domestic and external macroeconomic situation, risks and uncertainties related to inflation developments in the short and medium term, and will intervene in a timely manner by adjusting monetary policy instruments to achieve its fundamental objective of ensuring and maintaining price stability. The next meeting of the NBM Executive Board on monetary policy will be held on June 19, according to the approved schedule. At its last monetary policy meeting on March 20, the NBM kept the base rate applied to the main short-term monetary policy operations at 6.5% per annum. It should be noted that the NBM last changed the base rate applied to the main short-term monetary policy operations on February 5, increasing it by 0.9 percentage points, from 5.6% to 6.5% per annum. This was the second increase in the base rate applied to main short-term monetary policy operations this year, after the National Bank raised it by 2 percentage points on January 10, from 3.6% to 5.6% per annum. Overall, the base rate applied to the main short-term monetary policy operations changed three times in 2024. Specifically, it was lowered from 4.75% to 4.25% on February 6, from 4.25% to 3.75% on March 21, and from 3.75% to 3.6% per annum on May 7, 2024. // 12.02. 2025 — InfoMarket
