Finances

BASE RATE SHOULD REMAIN AT 6.5% DUE TO PROBLEMS WITH EXTERNAL FINANCING - EXPERTS

12 december, 2018

In conditions of problems with external financing, in particular from the EU, the base rate should remain at the previous level - 6.5%, said professional participants of the Moldovan capital market to Infotag correspondent on Wednesday morning.

"I suppose that at the today's sitting, the National Bank of Moldova (NBM) Executive Committee will keep unchanged the main rates of monetary policy, first of all the base rate, long standing at 6.5%. I agree that theoretically in the current situation on the financial market it should be lowered. But there are at least two factors that prevent this: country's problems with external financing and parliamentary elections in February", said the Infotag interviewee.

A bank currency dealer said that everything resumes to a single logic conclusion.

"The current stable situation at the macroeconomic level should be preserved for a certain time. If the base rate is lowered even by 1%, this may shake the situation and then for its stabilization the base rate should be again raised, which would be undesirable for the market", the dealer said.

Other interviewees said that the raising of monetary policy rates is neither possible because banks have too high current liquidity rates.

"If it were up to me, in the place of NBM President Octavian Armasu I would preserve the current situation to keep the macroeconomic stability, when nothing threatens it at the current rates of regulator's policy", said one of market participants.

Infotag's dossier: Currently, the NBM base rate accounts for 6.5%, interest rate on overnight credits and deposits - 9.5% and 3.5%, respectively. The reserve ratio from funds attracted in the national currency is of 42.5%, while in convertible currencies - 14%.

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