On Friday, the dollar showed a record monthly growth for almost a year. This happened because investors were looking for more reliable investments amid the escalating conflict in the Middle East and fading hopes for its end.
The dollar strengthened due to capital inflows into safe haven assets and expectations of an interest rate hike in the US this year. The dollar index hit the 100 mark and is up 2.4% since the beginning of March. This is the biggest monthly increase since July 2025, when the index climbed 3.4%.
The yen weakened to 160 yen per dollar, which traders see as a signal of possible intervention by Japanese authorities. Earlier, the exchange rate remained stable near 159.86 after reaching 159.98.
MUFG currency strategist Lee Hardman said the market is testing the resolve of the Japanese authorities. “We are approaching levels that we see as potential trigger points for intervention,” he said.
The Japanese yen is down 1.3 percent for the month and has come under pressure from rising Japanese bond yields. The Bank of Japan updated its neutral interest rate estimates, hinting at a possible hike to fight inflation. Japan, which relies heavily on energy imports, is more vulnerable to rising prices than other major economies.
The euro fell 0.1 percent to $1.152 and sterling slid 0.2 percent to $1.331, losing ground for a fourth straight session.
Strong dollar “pressures” on the leu
As the global dollar index grows, the Moldovan leu, following the euro, automatically weakens against the American currency.
As of March 27, 2026, the exchange rate is fixed at 17.57 MDL per dollar, reflecting the current market pressure. Although the current dollar level is well below historical highs of past years for the same date (e.g., MDL 18.04 in 2020), dollar appreciation has an inflationary impact.
The appreciation of the dollar leads to higher prices for critical imports: energy (gas, petroleum products) and raw materials, the settlement for which is often pegged to the dollar. Although the euro is the settlement currency for setting the exchange rate, the strengthening of the U.S. currency increases interest and principal costs in lei terms.
A strong dollar theoretically makes Moldovan goods cheaper in dollar-denominated markets, but this advantage is offset by higher input costs.
Against the background of volatility, experts note the growing interest of the population to diversify savings, including dollar and euro, to protect savings from the devaluation of the leu. It is worth waiting for the next interventions of the NBM, reducing foreign exchange reserves.
