The economy rebounded strongly from the pandemic recession last year while prudent macroeconomic management maintained robust buffers. But the war in Ukraine and the international sanctions imposed on Russia and Belarus have resulted in significant spillovers to Moldova, with implications yet to fully play out. At the outbreak of hostilities, FX market pressures triggered significant foreign currency interventions and bank deposit withdrawals, while dollarization has intensified. Moldova has received the highest per capita inflow of Ukrainian refugees (17 percent of the total population), of which about 100,000 refugees (4 percent of the total population) remain in Moldova. Driven by rising food and energy prices, inflation accelerated further above the target band.
This paper updates the Reported Social Unrest Index of Barrett et al (2020), reviewing recent developments in social unrest worldwide since the start of the COVID-19 Pandemic. It shows that unrest was elevated during late 2019, coincident with widespread protests in Latin America. Unrest then fell markedly during the early stages of the pandemic as voluntary and involuntary social distancing struck. Social unrest has since returned but generally remains below levels seen in 2019.
International Monetary Fund. Monetary and Capital Markets Department
The NBRB revised in 2018 its regulation on asset classification and provisioning (the Regulation). One of the main changes was the introduction of a new definition for NPLs based on the current framework of risk groups (RGs). This definition substitutes the previous term “problem assets.” One of the intentions of the replacement is to promote international comparability by using it as a financial soundness indicator (FSI). The reported levels of this new NPLs indicator are, however, relatively low and, more important, much lower than the previous indicator, based on problem assets. The new NPL indicator levels are relatively stable, around 4 percent. The previous indicator was also stable, but the levels were more than three times higher, about 13 percent.