National Bank governor says medium-term monetary policy strategy's goals met
"We have fulfilled everything that we planned in the 2010-2012 medium-term monetary policy strategy to ensure and maintain the stability of prices," the governor of the National Bank of Moldova (BNM), Dorin Dragutanu, has said.
Dragutanu noted that the BNM sterilized the excess of liquidities via sales of certificates. The bank increased the basic rate from 5 to 7 per cent, even if at the time, "everybody was speaking about increase in the credit's price and even about collapse." "We ruled out inflation-related expectations. Yet, the credits will continue cheapening, and they reached the historical minimal size last November," the governor also said. In November 2010, the interest rate of banking loans dropped to an average of 14.8 per cent.
By the actions that it has undertaken, the National Bank showed that "it really targets inflation." "In 2010, the prices went up to 8.1 per cent last March, and everybody was speaking that the BNM no longer keeps inflation under control and that it will reach 20-25 per cent. I said that it cannot be 20-25 per cent. The last forecast which I published in November shows a 7.8-per cent annual inflation. The latter will stand at 7.9 per cent probably, as the fuel prices increased," Dragutanu said.
In early 2010, the National Bank said that " inflation will go up due to a massive shock starting from the first quarter of 2010, when the tariffs increased, after which the inflation rate will stabilize and will have a decreasing tendency. And we see that these forecasts came true," Dorin Dragutanu said. In November 2010, official statistics showed a 7.7-per cent rise in prices against November 2009.
"We said that the implementation of the inflation targeting regime implies a floating exchange rate. We will not intervene on the market whenever there is some oscillation there and we kept our promise," Dragutanu said.
He also said that "in early 2006, inflation is likely to drop to 6 per cent even and then increase up to 7.5 per cent in order to decrease to 7 per cent in late 2011." "We hope that it will fall under 7 per cent," the BNM governor added.
Moldpres
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