Monetary reserves of the banking system constituted more than USD 1 bln in February

In February, monetary reserves of the national banking system constituted USD 1,049.7 mln, increasing by USD 9.4 mln compared to January. The National Bank of Moldova (BNM) increased its monetary reserves by USD 2.9 mln, up to the level of USD 775.9 mln. At the same time, external liabilities of the banking system constituted USD 297.6 mln USD. On February 28 the BNM’s debt to the International Monetary Fund summed up USD 131.62 mln, decreasing by USD 3.29 mln compared to the end of January 2007. The private non-guaranteed external debt, (including interest arrears) represented, as of February 7, USD 710.43 mln. The data of the central bank show that, at the end of 2006, BNM monetary reserves totalled more than USD 775 mln, above the target of 750 mln, established in the agreement signed with the IMF. At the end of the last year monetary reserves rose by more than USD 68 mln, due to both the purchase of currency on the domestic market and the entrance of a new instalment of the IMF loan on the accounts of BNM. During 2006, monetary reserves had a spectacular evolution from USD 597 mln, at the beginning of the year, to USD 775 mln. For 2007, analysts forecast that monetary reserves will continue their rapid growth, due to purchasing currency on the internal market and because IMF announced that it will increase financing for Moldova. Annually, about USD 1.2 bln are transferred as remittances from Moldovans who work abroad. An important share of this money is placed into the free market circuit. Consequently BNM intervenes by purchasing currency.