The National Bank of Moldova raised its benchmark interest rate to 7% from 6.5% on Thursday, citing mounting inflationary pressures tied to rising fuel and food costs.
Official statistics show annual inflation in the country at 6.8% year-on-year in May. Moldova, a small nation bordering Ukraine and European Union member Romania and described by the central bank as a former Soviet republic, is facing a run-up in consumer prices that prompted the policy adjustment.
In announcing the decision, the central bank said it would maintain a restrictive monetary stance. The statement pointed to a mix of external and domestic drivers behind the decision: unfavorable movements in international energy, food and raw material prices, together with domestic demand, have been increasing inflationary pressure.
The rate increase is intended to help stabilise inflation expectations and to provide an incentive for saving, the bank added. It framed the measure as part of a broader strategy to restrain inflation dynamics by tightening monetary conditions.
The central bank also noted that recent macroeconomic indicators are consistent with the projection it released in May 2026. That forecast envisaged inflation rising through the end of the year, and the bank signalled that its policy stance reflects that outlook.
Authorities emphasised that the decision was taken in the context of the observed international price trends for energy, food and raw materials and the current path of domestic demand. The bank described these factors as the primary sources of the heightened inflationary environment prompting the rate adjustment.
Context and implications
- The policy move raises the cost of borrowing via the central rate, which is a tool used to influence credit conditions and savings behaviour.
- By highlighting energy, food and raw material prices, the bank identified sectors where price movements are feeding into broader consumer inflation.
- The institution linked its action to its May 2026 forecast, which anticipated rising inflation through year-end, and signalled a commitment to restrictive monetary policy while those pressures persist.