The Moldovan leu is strengthening against the backdrop of weak demand in the country, but the situation will change after the restoration of lending and growth in demand - NBM.
This was stated by the President of the National Bank of Moldova, Octavian Armasu, answering the questions of the InfoMarket agency within the framework of the Economic Press Club after the presentation of the second Inflation Report this year at the National Bank. The head of the NBM noted that the National Bank of Moldova conducts interventions in the foreign currency market not to maintain a certain exchange rate or determine trends. "The NBM does not set trends, but intervenes to eliminate excessive volatility in the foreign exchange market," Octavian Armasu said. According to him, the main reason for the recent strengthening of the leu is weak demand, and in order to correct the situation, it is necessary to restore the fallen lending volumes and increase demand. “And then the market will come into balance, and the course will return to normality. This is our goal. We want to stimulate demand and balance not only the foreign exchange market, but also bring many processes in the economy back into balance,” the President of the National Bank emphasized. He did not predict what the base rate applied to the main short-term monetary policy operations might be at the end of the year, which the NBM, by its decision of May 11, immediately reduced by 4 percentage points - from 14% to 10% per annum. “We have two more rounds of forecasting ahead. We still need to analyze a lot of data, to see how events will actually develop. And depending on this, decisions on monetary policy will be made. But it is too early to say what the base rate will be at the end of the year for inflation to enter our target range of 5% ±1.5 percentage points,” the head of the NBM said. // 15.05.2023 — InfoMarket
