Moldova holds key rates steady, base rate at 3.5%

    Moldova's central bank maintained its basic rate at 3.5 percent along with its 1.5 percent rate on overnight deposits and 6.5 percent rate on overnight credits.
    The National Bank of Moldova (NBM) did not issue any statement in connection with the decision by its council to keep rates steady.
    Moldova's central bank last changed rates on April 25 when it cut its rates by 100 basis points. The central bank targets inflation of 5.0 percent, plus/minus 1.5 percentage points.
    Moldova's inflation rate eased to 4.5 percent in April from 5.4 percent the previous month and down from an average of 4.7 percent in 2012. The International Monetary Fund forecasts 2013 inflation at 4.6 percent.
    Moldova's Gross Domestic Product grew by 0.91 percent in the fourth quarter of 2012 from the third quarter for an annual contraction of 2.5 percent, a sharper decline than the third quarters's 0.2 percent fall.
    Last year Moldova's economy contracted by 0.8 percent due to severe drought and reduced demand for its products by its main trading partners, Romania and Russia.
    Moldova is one of the poorest countries in Europe, located between Romania and the Ukraine.  
    In January the NBM governor forecast that Moldova's economy should expand by 3 percent this year and 4 percent in 2014.

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