News about Macroeconomics

Despite a significant slowdown in economic growth in the first quarter of the year (+0.4%), the central bank nevertheless identified a host of pro-inflationary factors and made the fight against inflation its top priority.

The frequent turnover of prime ministers is increasingly becoming one of the main signs of systemic difficulties in the United Kingdom. Keir Starmer’s resignation, less than two years after a convincing victory in the general election, was yet another sign of the growing crisis of confidence in the country’s political leadership.

According to information from the Ministry of Finance, Moldova’s external public debt balance as of the end of April 2026 had increased by $151.7 million (+3.2%) since the beginning of the year, reaching approximately $5 billion. Of this amount, 93% consists of loans from the European Commission, to which Moldova’s debt has increased ninefold over the past five years.

On Monday, the Romanian parliament rejected Prime Minister Adrian Vestea’s nomination, prolonging months of political instability in the country and increasing the likelihood of early elections if the government’s second candidate also fails to win the support of lawmakers.

The proposed changes to the 2027 tax policy are raising more and more questions and comments. Ion Sturza, former Prime Minister of Moldova (1998–1999), has also shared his views on social media. Here are his main points.

British Prime Minister Kir Starmer announced his resignation and his departure as leader of the Labour Party in a special address delivered before entering his residence.

The Liberal Democratic Party of Moldova (LDPM) has prepared an analytical report “Causes of the Tax Burden in 2027 and Its Consequences for the Population and the Economy,” in which it examines the reasons that led to the adoption of the new tax policy for 2027, as well as the consequences it may have for the economy of the Republic of Moldova, the business community, and the country’s population.

The Federation of Public Service Workers’ Unions (SINDASP), which represents the interests of more than 16,000 union members, expresses its concern and disagreement with the bills concerning the reform of tax, customs policy, and the wage system. The organization notes that, in addition to reducing pay scales and cutting a number of wage supplements, the government is blocking collective bargaining and restricting workers’ labor rights.

Housing costs remain the largest expense for European households, but rent prices vary significantly—from the relatively affordable capitals of the Balkans to record-high prices in Switzerland and the United Kingdom.

There are approximately 170,000 public sector employees in Moldova. The Ministry of Finance assures that most of them will receive a salary increase ranging from 10% to 30% starting September 1, 2026. The main increases will apply to employees in the education, healthcare, social protection, national defense, and public order sectors.

Germany’s government budget deficit is projected to rise to 5% of GDP in 2027, according to data from the Ifo Institute for Economic Research.

Spain will direct tourists to less-visited regions to ease the strain on popular resorts. The country expects tourist arrivals to reach 100 million during the 2026 season.

These days (June 18–21, 2026), finance ministers and central bank governors from the member countries of the Belgian-Dutch subgroup of the IMF and the World Bank have gathered in Varna, Bulgaria. The main goal of the meeting is to turn uncertainty into long-term opportunities for regional economies. Anca Dragu, Governor of the National Bank of Moldova, held a series of bilateral meetings with finance ministers and senior IMF officials during the forum.

Venice authorities plan to raise the entry fee for tourists to 50 euros on days of peak visitor numbers, a move that has already sparked a strong political and public backlash.

Switzerland has lost its status as the world’s most competitive economy, dropping to third place in the IMD World Competitiveness Ranking 2026. Singapore took the top spot, while Hong Kong came in second. These findings are based on the results of the annual study by the International Institute for Management Development (IMD).

Former Prime Minister and Member of Parliament Ion Chicu commented on the proposed reform of the public sector pay system, describing it as a simple adjustment to existing legislation rather than a revolutionary reform, as the authorities had previously promised.

At its meeting on June 18, 2026, the Executive Committee of the National Bank of Moldova unanimously raised the base rate from 6.5% to 7% per annum. The reserve requirement ratios for funds raised in Moldovan lei and in convertible foreign currency were maintained at their current levels—18% and 26% of the reserve base, respectively.

Poverty is a state of being. Depression is a mechanism—one that operates over a long period of time. It is no longer merely stagnation or a recession. Depression reflects the absence of any possibility for change. Poverty shows how much a region has today. Depression shows whether it is capable of shaping its own future. These are fundamentally different questions that require fundamentally different answers.

In April 2026, imports of goods exceeded exports by a factor of 3.4 for the first time in history. Consequently, the trade deficit for that month amounted to 642.5 million euros, which is 114.4 million euros, or 21.7%, higher than in April 2025. 

The government has published a draft law on reforming the unified pay system in the public sector. According to the draft, the reform is based on four main objectives: ensuring comparable salaries for similar positions, increasing competitiveness relative to other sectors, incentivizing professional activity, and maintaining budgetary discipline.