The dollar stabilized in Asian trading on Thursday, maintaining an optimistic outlook. The Chinese yuan remained flat after the publication of mixed purchasing managers’ index data, while most other Asian currencies fluctuated between virtually unchanged and low values as reports of potential new military action in the US-Iran conflict kept markets on edge.
Following the Fed’s currency support measures, a sharp rise in oil prices put significant pressure on emerging market currencies. The shift to safer assets that began on Tuesday continued to strengthen the dollar and put pressure on global stock markets.
Investors are revising expectations, abandoning predictions of a quick rate cut as the Fed makes it clear that the fight against inflation is not yet over. Amid the tough rhetoric, US Treasury bond yields are rising, making dollar assets more attractive.
The “load” on the leu is increasing
Since a significant part of import (energy resources, fuel, electronics) is denominated in dollars, its growth directly leads to the rise in prices of these goods in Moldova. According to experts’ estimates, the growth of dollar by 1% can add about 0.7% to the cost of imported goods already in a month.
Also, since part of Moldova’s external public debt is denominated in dollars, its strengthening increases budget expenditures on servicing and repayment of these loans.
The National Bank forecasts the dollar exchange rate in 2026 in the range of 16.8-17.5 MDL. Strong jumps are not expected, as a significant part of foreign trade and remittances to the country is carried out in euros, which mitigates the “dollar shock”.
The regulator keeps the prime rate at 5% to keep inflation within the target corridor of about 5.0% (±1.5 p.p.).
