The decline in national economic activity in the second quarter of this year was slightly tempered compared to that at the beginning of the year. The Gross Domestic Product (GDP) decreased by 2.2% compared with the corresponding period last year after an annual rate of 2.4% recorded in the first half of the year, shows inflation report No. 4 presented by the National Bank of Moldova, IPN reports.
According to the central bank, the dynamics were higher than those anticipated in the inflation report for August 2023. The evolution of economic activity was supported by a modest internal demand signaled by the decline in consumption and investments, mainly as a result of the diminution of the real incomes of the population and the yet restrictive conditions for lending and the increased uncertainty in the region.
The given impact was partially attenuated by the favorable result in the agricultural sector and the performance in the ICT sector. A positive contribution was also made by the developments in education, the medical and social services. The seasonally adjusted time series shows a decline of 0.5% in the GDP compared with the first quarter of 2023.
In general, in the first half of 2023, the GDP decline by 2.3% on 2022. In this connection, similar to last year, as it was estimated, the aggregate demand exerted disinflationary pressure on prices. In the second quarter of 2023, the consummation of households declined in a more evident way comported with the start of the year. The final consumption of the public administration diminished. Investments in the period generated a negative impact on the GDP growth due to the gross capital formation subcomponent.
Net exports had a positive impact on the GDP growth in the second quarter of 2023 against the pronounced decline in imports. By categories of resources, the decline in the GDP was primarily influenced by the contraction of the gross value added in trade, industry and the building sector. This impact was alleviated partially by the developments in agriculture, the ICT sector and the accommodation and food services sector. The positive developments were influenced by the developments in the educational, medical and social services sectors. The positive dynamics of the economically active and working population seen at the beginning of this year continued in the second quarter of 2023, but at a more modest pace.
In the third quarter of 2023, the revenues of the national public budget grew, being by 12.3% over the level recorded in the same period of 2022. The expenditure of the national public budget also rose, being by 24.8% over the level registered in the third quarter of 2022. On the state securities market, the interest rates in the third quarter of 2023 continued following a downward trend.
