Moldova Holds Benchmark Rate at 3.6%, Reduces Reserve Requirements

The National Bank of Moldova raised its benchmark interest rate by 150 basis points to 6.5% in May 2026, marking its first rate hike since early 2025 and bringing borrowing costs back to levels last seen in 2025. The central bank said the decision was driven by the need to calibrate monetary policy to contain mounting inflationary pressures stemming from the conflict in the Middle East. These pressures have been reflected in higher international prices for energy, food, and raw materials. Policymakers now expect inflation to exceed the upper bound of the central bank’s target range of 5% ±1.5 percentage points in the coming months. Inflation in Moldova accelerated to 5.8% in March. Meanwhile, policymakers also raised the interest rate on overnight loans to 8.5%, increased the repo rate to 6.75%, and lifted the overnight deposit rate to 4.5%.

The National Bank of Moldova held its benchmark interest rate steady at 5% at its March 2026 meeting, following a 100 bps cut in December. The decision comes amid international turbulence sparked by the Middle East war, with surging global energy prices posing risks to economic growth and inflation worldwide. Moldova’s annual inflation rose to 5.1% in February 2026, from a one-and-a-half-year low of 4.9% in January. The NBM emphasized that previous monetary measures, along with their delayed effects, continue to support its goal of keeping inflation within ±1.5 percentage points of the 5% target. Meanwhile, preliminary estimates showed that the economy grew 3.6% year-on-year in Q4 2025, after a downwardly revised 5.1% expansion in Q3. The central bank signaled vigilance in monitoring domestic and global developments, including the escalating Middle East conflict, and emphasized that it is ready to tighten policy if high energy, food, or raw material prices threaten inflation.

The National Bank of Moldova left its benchmark interest rate unchanged at 5% on February 5, 2026, following a 100 bps reduction in December. The decision takes into account the delayed effects of prior monetary policies and aims to maintain medium-term inflation within ±1.5 percentage points of the 5% target, deemed optimal for sustainable economic growth. Inflation eased to a one-year low of 6.8% in December 2025, down from 7% in November, and is expected to return to the target range in the first quarter, remaining close to target thereafter. At the same time, the central bank reduced reserve requirements in both Moldovan lei and freely convertible currency to meet the banking system’s liquidity needs. This measure is expected to increase lending capacity to the real and public sectors, supporting aggregate demand by encouraging consumption and investment, and helping balance the national economy and the current account.