The interest rates on loans were increased and by such a move the National Bank of Moldova aims to discourage lending and excessive consumption. The interest rates on deposits were also increased so that the people are motivated to economize and not to spend. This way, the interest rate on overnight loans was set at 20.5%, while those on overnight deposits – at 16.5% a year, up 3 percentage points each, IPN reports.
In a news conference where he presented the monetary policy decision, NBM governor Octavian Armașu said that the Executives Board of the central bank decided that the base rate applied to major short-term monetary policy operations will be 18.5% yearly.
The required reserves ratio in Moldovan lei and non-convertible currency is also raised. The required reserves ratio in Moldovan lei for the application period of June 16-July 15 will be 32% of the calculation base, up from 30%, while for July 16 – August 15, 2022 will be 34%, up from 32%. The goal is to stimulate the rates on the market up.
In the case of the required reserves ratio in non-convertible currency, this was increased from 33% of the calculation base, to 36% and from 36% to 39% respectively.
“The risks and uncertainty related to the stability of consumer prices are high and the restrictive character of the monetary policy conduct was maintained therefore. In continuation, the monetary policy decisions are opportune from a number of perspectives. These are related to the tempering of the second-round effects of the shocks of prices coming from outside, balancing of the aggregate demand, stimulation of savings to the detriment of immediate consumption and attenuation of pressure on the depreciation of the national currency following the increase in the current account deficit and capital reflow,” stated Octavian Armașu.
According to him, the monetary policy decision pursued by the NBM creates monetary conditions that can alleviate the alert growth rates in consumer prices and secondary effects of the supply. The bank aims to anchor the inflation anticipations and to reduce inflation to the variation interval of ± 1.5 percentage points from the inflation target of 5% in the medium term.
