Alexandru Muravski, former Minister of Economy of Moldova
The essence of the experts’ position
The imported nature of inflation in Moldova has long been a parable. The main reason for the rise in prices in the country is not the excess of money in the domestic market, but the rise in the price of external factors: energy resources (gas, electricity), fuel and imported goods, on which dependence remains very high, despite the “green transition”.
Former Economy Minister Alexandru Muravski also insists on the uselessness of the prime rate increase, stressing that the increase of the NBM prime rate and the rise in the price of credits are not able to reduce the prices for gasoline or diesel. Such actions only slow down the real economy.
“Inflation grows, we raise the prime rate, then increase the reserve requirements. Everything seems to be right. It’s classic. Inflation is a monetary factor. There’s a lot of money, it pressures the market, the market reacts by raising prices. So it is necessary to remove excess money, to make money more expensive, then demand will be less, and prices will go down. Well, you can’t get it wrong. But there is a nuance: all this works for economies in which prices really rise as a reaction to excess money. Or, in any case, this is the prevailing factor,” he wrote in social networks.
Proposed non-monetary methods
Instead of monetary contraction, experts urge the government to use administrative and fiscal levers of control. For example, fiscal easing, direct subsidies, price regulation.
Temporary reduction of the state’s share in the final cost of key goods (reduction of excise duties and VAT on fuel and energy resources), direct subsidies and compensations, restraint of regulated prices and trade mark-ups could bring more benefits to local producers and not inflate inflationary expectations in connection with world events that do not bode well for the Moldovan economy.
Reducing dependence on external price shocks, a policy of containment, not the other way around, when the government “clears the space” for increasing imports, abolishes trade mark-ups for socially important goods, although long outdated, without offering anything in return, except for the declared care. The authorities do not even think about stimulating import substitution to reduce dependence on external prices.
“The volume of imports far exceeds the volume of exports and, accordingly, the influence of external causes of price growth is much stronger than internal ones. You can remove money altogether, but gasoline and diesel prices will not fall. Unless the government starts to reduce its share of the pie in the form of VAT and excise taxes,” says Alexander Muravsky.
According to him, “the external factor can be outweighed only by strengthening and increasing domestic production.
“And then, at the same energy prices, prices in other sectors will be stable or even declining, and will pull away part of the inflation generated by imports. What the NBM traditionally does does not achieve this goal. On the contrary, it worsens conditions for domestic producers, because credits become more expensive, and therefore investment activity has to be reduced. And this is in a situation when a significant part of potential funds for investments is already diverted to more expensive energy resources and other imported components of production,” believes Alexander Muravski.
According to him, it is necessary to look for other, non-traditional measures to combat inflation, and maybe even for a while to turn a blind eye to it, focusing on stimulating production. At the same time, there is no “ready-made recipe” for solving the problem.
“It requires a serious brainstorming of good specialists… (It is necessary) to think how to work out a more effective method of fighting inflation for our producers than the one repeated by the NBM like a diligent student, regardless of who is in charge of it,” the expert believes.
The risk of double-digit inflation
“The population has nothing to do but to tighten their belts even tighter,” ironizes economist Volodymyr Golovatyuk, noting how the inflation spiral is already unwinding in April.
“In April, average consumer prices rose by 1.8% compared to March, which far exceeded their growth in March compared to February. As a result, annual inflation was 6.8% in April 2026 versus 5.8% in March. And it’s not just the events in the Middle East, although the latter gave the price growth a tangible impetus, – says Vladimir Golovatyuk. – Annual inflation in February rose by 4.3% compared to January, in March compared to February – by 14.8%, and now in April compared to March – by 16.5%. It remains to wonder what will happen by the end of the year!”.
The National Bank, meanwhile, knows this. The central bank will not be able to prevent the import of inflation, but to mitigate its consequences, the regulator believes.
“The annual rate of inflation in the following months of 2026 will exceed the upper limit of the deviation corridor of ±1.5 percentage points from the inflation target of 5%,” says the NBM. But this measure will allow to successfully combat “inflationary pressures, secondary effects of supply shocks and stabilize inflation expectations in order to return the annual level of consumer prices within the acceptable range of inflation,” the regulator assures.
Arguments against stagflation?
The annual inflation rate in 2026, according to the new estimates of the NBM, may exceed the target corridor and reach about 7%. Although it is already around 7%, the regulator has decided “not to exacerbate” and paints rosy pictures of how, as a result of its decision to raise the prime rate to 6.5% per annum, the demand of the population and businesses for new loans will “gather”, incomes will fall(consumption too – ed.) and imported inflation will “dissipate” by itself.
The National Bank was not very successful in reducing demand before, when it was fighting inflation with such measures. But the regulator has always been able to sacrifice domestic production and consumption for the sake of the notorious “corridor” of permissible inflationary values.
Arguments of the NBM about the miraculous properties of the monetary policy are now also based on the “merits” of the economy, which allows us to look, however, no further than the first quarter.
According to the regulator, the data published by the National Bureau of Statistics for the first two months “reflect a favorable forecast of economic growth in the first quarter of 2026”.
Thus, in January-February 2026, industrial production increased by 2.8%, domestic retail trade grew by an average of 16.3%, while wholesale trade declined by 0.4%. At the same time, the annual rate of exports amounted to 11.6% and the annual rate of imports decreased by 0.6%.
Overall, agricultural production in the first quarter of 2026 increased 8.6% from the same quarter of the previous year. This means that “in terms of sources of consumption finance” will be fine.
In addition, in the first quarter of 2026, remittances from abroad to individuals increased by 10.4%, year-on-year. And “the volume of loans in lei increased,” although “the volume of deposits decreased compared to the first quarter of 2025.”
