National Bank of Moldova maintains key interest rate at 9%

Moldova's central bank, BNM, decided on Thursday to keep its key rate at 9.0%, after lowering it from 9.5% last month.

"This decision aims at maintaining inflation rate close to the target of 5.0% in the medium term, with a possible deviation of plus or minus 1.5 percentage points," BNM said in a statement.

"The gradual calibration of the monetary policy stance aims to ensure real monetary conditions supporting lending and saving, and boosting the domestic demand," the central bank said.

The monetary policy stance depends on the risks and uncertainties associated with internal and external developments, BNM said. External risks are associated with the increase of international prices of food and raw materials along with the uncertainty related to a higher international price of oil.

The main internal risks and uncertainties arise from a delay in the adjustment of regulated tariffs and from the modification of excise duties, as well as from the quality of the country's 2017 harvest, the bank said.

Moldova's consumer price inflation decelerated to 2.5% year-on-year in October, its slowest pace in 16 months, from 3% in September.

According to the bank's latest forecast, the average annual inflation rate will reach a level of 6.3 percent in 2016 and 4.6 percent in 2017.

BNM also decided to hold the interest rates on overnight loans and deposits at 12% and at 6%, respectively.

The bank kept the required reserves for deposits in freely convertible currency at 14.0%, and the required reserves from deposits in Moldovan and non-convertible currency at the current level of 35.0%, SEE NEWS reports.

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