Moldova Significantly Hikes Key Policy Rate

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.

The National Bank of Moldova cut its benchmark interest rate by 100 basis points to 5.0% on December 11, 2025, marking its third rate cut this year and extending its accommodative monetary policy stance. Annual inflation in November remained at 6.99%, above the central target of 5.0% ±1.5%, driven primarily by regulated and food prices. Inflation is expected to return to the target range in December and remain at the lower bound through Q1 2026. The economy continues to show positive growth, providing a supportive environment for policy easing. Industrial production in September grew 9.0% year-on-year, while exports and imports increased 23.1% and 21.2%, respectively. The external environment remains broadly stable, though risks persist from energy, food, and geopolitical factors. Overall, risks to inflation are skewed toward disinflation, reinforcing the need to maintain an accommodative policy stance to achieve medium-term inflation objectives.