Finances

NBM LOWERS BASE RATE TO 13% FROM 15%

27 may, 2016

The National Bank of Moldova lowered on Thursday the base rate by 2% - to 13% from 15%.

This is already the fourth lowering of this index in 2016. The first lowering accounted for 0.5%: to 19% from 19.5%; the second – to 17% from 19%; the third – to 15% from 17%.

Also, members of the NBM Executive Committee unanimously voted for lowering of two other sensible monetary policy rates: the interest rates on overnight credits to 16% from 18% and overnight deposits – to 10% from 12%.

Commenting on this decision, bankers motivated the rate lowering by the consumer price index year to date in conditions, when the evolution of energy resources and food products prices is retaining the inflation pressing.

“The NBM is doing its best to stimulate the economy development at the expense of cheaper and long money in the market. Signals the regulator is giving to the market are aimed at starting the process of lowering yield rates on deposits and in parallel the rates on crediting projects in the real sector of economy”, said one of Moldovan banks’ heads.

Annual rate of inflation in Moldova accounts for 8.3% currently. It is possible that already by the end of 2016 the inflation will closely reach the targeted 5% ± 1.5%.

The sustainable trend to lowering of the base rate, which fell to 13% from 19.5%, allowed the Ministry of Finance to sharply lower the yield on government securities. At the recent auction on May 24 the rate of yield with a maturity of 365 days accounted for 10.25%, while back in the beginning of the year it exceeded 26%.

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