- Decision
- Raise
- Rate change
- 50 bps
- base rate
- 7.5%
The National Bank of Moldova’s Executive Board unanimously raised the base rate by 50 basis points to 7.50% on August 6, continuing restrictive policy as robust consumer demand and persistent supply shocks drive inflation higher. Over the past year, the rate fell from 6.25% in August 2025 to 5.00% in December, before rising by 150 basis points in May 2026 and 50 basis points in both June and August. The central bank set overnight lending, repo and overnight deposit rates at 9.50%, 7.75% and 5.50%, respectively, while retaining reserve requirements at 18% for MDL and non-convertible currency funding and 26% for freely convertible currency funding. Annual inflation was 6.51% in June and is forecast to average 7.2% in 2026 and 6.2% in 2027, remaining above the upper bound of the 5% target’s ±1.5-percentage-point range through the second quarter of 2027 before returning within it in the third quarter. Economic activity is expected to grow faster in the second quarter than in the first, while new lending rose 13.1% year on year. Heightened geopolitical tensions, volatile energy prices and expected increases in international food prices remain key global inflation drivers. The National Bank of Moldova said it will continue monitoring domestic and external developments and use available instruments as needed to achieve price stability.
Rate evolution
The National Bank of Moldova moved from a June 2025 hold into a 150 basis point easing cycle through December, paused at 5.00% in early 2026, and then reversed course with increases of 150 basis points in May, 50 basis points on 18 June, 50 basis points on 6 August and 150 basis points on 17 September 2026, taking the base rate applied to the main short-term monetary policy operations to 9.00%. The earlier cuts reflected moderating inflation, transmission of previous restrictive measures and disinflationary aggregate demand, while reserve-ratio reductions sought to lower credit costs and support demand.
Statements initially described risks as broadly balanced with a disinflationary bias, but by May 2026 the balance had turned inflationary as the Middle East conflict raised energy, food and raw-material prices. The June increase responded to intensifying supply pressures, stronger domestic demand and inflation above the target range, while the August move addressed consumer demand and persistent supply shocks. On 17 September, the Bank maintained a restrictive stance as adverse international energy, food and raw-material prices intensified supply pressures and household disposable income supported domestic demand. Annual inflation rose to 6.96% in August, above the upper bound of the range around the 5.0% medium-term target, while the Bank revised its inflation projection down for the third quarter of 2026 and up for the fourth quarter of 2026 and the first half of 2027 relative to its August forecast.