The base rate applied to the main short-term monetary policy operations was decreased from 4.25% to 3.75%. annually. A decision to this effect was approved by the Executive Board of the National Bank of Moldova.
Also, the interest rate on overnight loans was set at 5.75 percent annually, compared to 6.25 percent at present, while on overnight deposits - at 1.75 percent annually, as opposed to 2.25 percent now, IPN reports.
“It is a decision that reflects our commitment to respond dynamically to the current economic developments. We lowered the base rate to support demand and boost consumption. This decision means lower borrowing costs, an excellent opportunity for consumers to refinance their existing debts at more advantageous rates and to invest in expansion and innovation,” NBM governor Anca Dragu told a press conference.
The central bank’s Executive Board also decided to maintain the required reserve ratio attracted in Moldovan lei and non-convertible currency at the current level of 33% of the base. Also, the required reserve ratio attracted in freely convertible currency was maintained at the current level of 43% of the base.
“The National Bank of Moldova’s decision aims to maintain inflation within the variation range of ±1.5 percentage points from the 5% target that is considered an optimal level for the economic growth and development of the Republic of Moldova in the medium term. Thus, the National Bank focuses on further stimulating aggregate demand, including by encouraging consumption and investments, balancing the national economy and anchoring inflationary expectations,” said Anca Dragu.
According to the governor, the NBM will continue to closely monitor the economic developments internally and externally and, if necessary, in a responsible and transparent manner, will use all the available instruments to achieve the fundamental objective of ensuring and maintaining price stability.
