The Moldovan leu has appreciated continuously given the surplus of foreign currencies on the market. This is due to the fact that some of the payments for energy are financed by the foreign partners. Respectively, these were delayed and are not made as last year, in the winter season, but will be available in summer. As a result, the demand for foreign currencies declined slightly. Given the recession, the demand for foreign currencies from importers also decreased, National Bank of Moldova (NBM) governor Octavian Armașu told a news conference.
“The causes are fundamental. Almost daily, the NBM intervenes and purchases foreign currencies. There is a surplus of foreign currencies on the market. Our foreign exchange market is not deep and is rather narrow. Respectively, the large amounts of foreign currencies from the supply cannot be easily absorbed by the market. To avoid excess volatility, we need to intervene and purchase such currencies for the NBM reserve. This is one of the explanations why our reserves reached a new record level,” stated the governor.
Octavian Armașu noted that given the recession, the demand for foreign currencies from importers also declined and this generated a surplus on the foreign exchange market, which exerts appreciation pressure.
In such conditions, the NBM intervenes with monetary policy to stimulate domestic demand, which is to balance also the demand for foreign currencies following the reinvigoration of imports.
