MDL deposits are not efficient when inflation grows

Bank deposits in MDL are not efficient at the moment, under inflation conditions, the financial expert of the Institute for Social development and Initiatives IDIS „Viitorul”, Victor Sula, stated on Thursday on the occasion of launching the Economic Monitor on the II quarter. According to him, in Moldova there will be attested trends of changing deposits in MDL into dollars, „It is clear that when the leu decreases, it is not logical to place money in the bank at a rate of 10-12%, as you are going to loose this money, that’s why it is absolutely necessary to exchange funds into dollars as soon as possible,” the expert mentioned. According to him, the inflation forecasts regard not only this year but also the next years, as the increased price of gas was not translated yet into costs. At the same time, the inflation will come as well from outside, once with imported goods, because they increased in price together with the world price of oil and gas. This situation will unavoidably lead to increase of the cost of credits in MDL provided by banks, as the latter ones will not provide credits against their own financial interests, the experts said, mentioning that „all will try to protect their assets from inflation”. IDIS „Viitorul” experts consider that the erroneous anti-inflation policy will not stop price increase, and their share will get till the end of 2006 to 13.2%. According to them, the prices continue to grow in spite of the efforts of the Government and the National Bank to control the monetary inflation. The main cause is that in RM the inflation processes are dealt with strictly using monetary methods, while they are resulting from the growing imports and reduced competitiveness of the national economy. Therefore, the measures and decisions adopted within the policy of stabilizing prices lead to, in fact, stabilizing the exchange rate, and do not solve the problem of the inflation in the economy. Experts say that the inflation will increase as result of the increase in price of gas and petroleum, electric power and due to lack of alternatives for energy imports.