The base rate on the main short-term monetary policy operations remains at the level of 2.65% a year. The interest rate on overnight loans is maintained at 5.15% annually, while that on overnight deposits at 0.15% annually. The monetary policy decision was adopted by the Executive Board of the National Bank of Moldova on December 9, IPN reports.

“The decision reflects the continuity in creating monetary conditions for supporting the national economy. The decision was taken in a bid to ensure the inflation remains in the variation interval of ±1.5 percentage points from the inflation target of 5% in the medium term. The risk of deviation from the forecast inflation and the periodicity of propagation of impulses of the monetary policy adopted earlier were also taken into account,” the governor of the NBM Octavian Armașu told a news conference, noting this is the last monetary policy decision this year.

The governor said the statistics published after the October round of forecasts reveal possible descending trends from the forecast inflation. The annual rate of inflation in October continued to have a downward trajectory, but with a more accentuated magnitude than expected, being of 1.6%.

Among the main causes were the depreciation of the currency in Turkey and Ukraine, which are the main partners from which food products are imported, and the reduced aggregate demand.

Octavian Armașu also said there is a risk that the annual inflation at the end of this year will decline close to 0%.

The NBM noted that in the course of this year it actively used an arsenal of monetary policy instruments for supporting the domestic aggregate demand. A fiscal impetus is needed to stimulate the aggregate demand and internal economic activity. This is essential in the current situation of economic and political uncertainty that involves major risks of delays in taking investment decisions.