The National Bank of Moldova has raised its average annual inflation forecast for 2026 by 2 percentage points, from 5% to 7%, and for 2027, from 4.5% to 5.8%, it expects annual inflation to peak at 8.6% in the fourth quarter of 2026 and to reach a minimum of 4.1% in the fourth quarter of 2027 and the first quarter of 2028
This was stated in the second Inflation Review of the year, published by the National Bank of Moldova on Thursday. The upward revision to the annual inflation forecast for 2026 compared to the February Inflation Report reflects an assessment of higher international oil price growth, higher international food prices for the entire comparable period, higher import inflation dynamics in 2026, higher short-term inflation due to the secondary effects of higher fuel prices in the context of the war in the Middle East, and higher-than-expected actual inflation in the first quarter of 2026. The document notes an upward trend in the annual inflation rate amid pressures caused by the escalation of the conflict in the Middle East, which has led to higher prices for energy, food, and raw materials worldwide. In early 2026, the annual inflation rate in Moldova declined significantly, reaching 4.85% in January, after the effects of the energy tariff adjustment in January 2025 disappeared. In February 2026, inflation remained close to the target, and by the end of the first quarter of this year, it showed an upward trend amid higher oil and natural gas prices caused by the blockade of the Strait of Hormuz, reaching 5.81% in March and 6.8% in April. In order to mitigate inflationary pressures in the context of escalating geopolitical conflicts and global trade tensions, the National Bank of Moldova decided to increase the base rate for its main monetary policy operations from 5% to 6.5% per annum. "We are focusing our efforts on mitigating the effects of the energy crisis and ensuring price stability in an international context marked by uncertainty and major shocks. "We are addressing these challenges with the utmost responsibility and a careful balance between supporting economic activity and maintaining financial stability in order to ensure a favorable economic environment for investment," emphasized Anca Dragu, Governor of the National Bank of Moldova, upon the publication of the new Inflation Report. The second Inflation Report notes that inflationary pressures caused by rising energy prices have altered financial market expectations, prompting central banks to reconsider their previous plans to maintain or reduce interest rates, now targeting their gradual increase throughout the year. The report notes that the average inflation rate in Moldova in the first quarter of 2026 was significantly lower than in the previous quarter. At the same time, the annual inflation rate was slightly higher than expected in the February 2026 Inflation Report. According to estimates, domestic demand continued to exert a disinflationary effect on prices in the first quarter of 2026. The upward price trend was supported by the emergence of unfavorable sectoral shocks. Rising energy prices, their secondary effects and other supply imbalances will contribute to higher inflation in the coming period. Disinflationary domestic demand will partially mitigate this impact. The tariff adjustment method, as well as the tense situation in the region and the risks of its escalation, maintain significant uncertainty regarding the inflation forecast. The NBM notes that the global economy is developing amid geopolitical and macroeconomic risks. The economic growth forecast for the eurozone has been lowered. Inflation in the eurozone will exceed the ECB's target. The average EUR/USD parity is expected to be 1.17 in 2026 and 1.18 in 2027. International oil prices and European natural gas prices have been revised upward for the entire forecast period in the context of geopolitical risks. Food prices will increase by 2.2% in 2026 due to reduced supply and lower export demand, and will rise by 0.2% in 2027. Herewith, inflation in the region returned to the monetary authorities' target range, with the exception of Romania, Ukraine, and Hungary. The monetary policy base rate remained unchanged in Romania, Hungary, and the Czech Republic and was lowered in Poland and Ukraine. Robust economic growth in the United States exceeded the global average. Economic activity in the eurozone developed in line with the fourth quarter of 2025. Meanwhile, the eurozone economy is showing signs of slowing growth, with the industrial sector contracting in January-February 2026. The NBM emphasizes that the annual inflation rate will trend upward this year and then downward for the remainder of the forecast period. In the second quarter of 2026, the annual inflation rate will be at the upper limit of the deviation range from the target value, and starting from the next quarter, it will exceed the upper limit of the range for 3 consecutive quarters, and then, starting from the second quarter of 2027, it will return to this range and remain within it until the end of the forecast period. The annual inflation rate will reach a maximum value of 8.6% in the fourth quarter of 2026 and a minimum value of 4.1% in the fourth quarter of 2027 and in the first quarter of 2028. Average annual inflation will be 7% in 2026 and 5.8% in 2027. The annual inflation rate will be determined by the positive contribution of core inflation, food prices, administered prices, and fuel prices, with the exception of the second and third quarters of next year, when they will have a negative impact. The NBM stated that it will continue to monitor domestic and external macroeconomic developments, as well as risks that may affect the trajectory of inflation, in order to achieve the main goal of ensuring and maintaining price stability. // 14.05.2026 – InfoMarket.
