Transnistria under pressure to depreciate ruble

Transnistria under pressure to depreciate ruble
By bne IntelliNews March 30, 2016

The government of the Moldovan separatist republic of Transnistria decided in a March 28 decree that exporters have to sell 7% of their foreign currency revenues to the central bank, novistipmr.com reported.

The separatist republic’s central bank strives to maintain the local currency (the Transnistrian ruble) within a narrow 11-11.3 band against the US dollar. But the exports have declined significantly, by 27% y/y over the past three months, according to state news agency Novosti Pridnestrovya, quoting discussions between top economic officials and president Yevgeny Shevchuk.

“There was a deficit seen in the Transnistria’s foreign exchange market at the beginning of March, 2016”, Novosti Pridnestrovya reported.

A steep increase in foreign currency demand occurred at the end of February alongside negative expectations about the electric supply contract with Moldova. However, Transnistria’s power producer won the auction in Chisinau, and will continue to supply electricity to Moldova for one more year, which has supported the local currency.

Shevchuk held a meeting with the prime minister, finance and economic ministers and the chairman of the Transnistrian Republican Bank (PRB) on March 28. The meeting focused on the current socio-economic situation, as well as proposals to review customs tariffs on a number of import goods.

 

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