Starting with 2017, the national currency has been steadily rising with respect to all other reference currencies posted on the National Bank website. Market Economy Institute expert Viorel Gîrbu believes the trend of the national currency is, first and foremost, a result of the banking crisis of 2014-2015, followed by the currency market shock of 2015. In his opinion, this event blew up the growing trend of the national economy at the time, and has had a profoundly negative effect on the trust of the business sector, leading to reluctance to build new businesses. The expert adds that the main problem occurred with the theft of the billion dollars from the banking sector, IPN reports.
“So, the Moldovan leu is rising relative to the dollar, euro, Russian ruble, Romanian leu, and the Ukrainian hryvna. This means Moldovan exports are increasingly expensive, and Moldovan exporters cash in less and less money. This leads to exporters’ progressively smaller capacity to invest in business development, technology updates, and increase salaries, i.e. to raise national economy performance indicators. This can only have a negative meaning, as I see it,” stated Viorel Gîrbu in an interview with Radio Free Europe.
The expert deems regrettable the fact that Moldova had to face such a grave situation as the banking crisis that has stricken both the business sector and the common citizenry. The Government hasn’t provided compensatory measures, but has chosen instead to follow its own interests, as is evident from the trend of the national economy. As for what may happen next, the expert says that, in the pre-election period, the Government is very generous with initiatives to create and stimulate trust towards the efficiency of its reforms. “The trend of the leu will not be affected by it, I believe, since the Government has a leverage margin. The Government might focus on populist moves, while simultaneously cutting current expenses, which aren’t easily observed by citizens,” mentioned Viorel Gîrbu. However, the negative trend will be visible later, not exactly in the electoral period.
On another topic, Viorel Gîrbu said that in observing exchange rates for the leu, one mustn’t only observe supply, but demand as well. According to him, supply is indeed on the rise. The currency supply on the Moldovan market is rising. Yet, it mustn’t leave the rosy impression that the general trend is upward sloping. There have been better circumstances before. The least observed aspect, says Viorel Gîrbu, is the currency demand from businesses, which presents a grave problem. In 2013, the currency demand in the first half of the year was of 1.3 billion, whereas this year it is below one billion.
