Skopje, 13 April 2023 (MIA) - The National Bank remains committed to the fulfillment of its main objective, that is to maintain medium-term price stability. For that purpose, the central bank continues to carefully monitor the situation and takes all the necessary measures to return inflation to two percent target over the medium term, said National Bank Governor Anita Angelovska-Bezhoska, who is taking part in the 2023 Spring Meetings of the World Bank Group and the International Monetary Fund in Washington.

Maintaining financial stability is also in support of achieving this goal, Angelovska-Bezhoska said in the interview with VOA.

In regard to the latest developments in the financial system and the IMF recommendations that despite their influence on the financial markets, the central banks should continue to tighten the monetary policy, the Governor said that our central bank carefully monitors the macroeconomic parameters and, if necessary, is to take appropriate measures.

“The central bank is still in a cycle of monetary policy tightening, which began at the end of 2021, through the management of the liquidity of the foreign exchange market, and from April 2022 onwards, through an increase in interest rates. This monetary setup was also supported by several changes to the mandatory reserve instrument, which are aimed at increasing savings in denars. At the same time, in order to enable the domestic banks to adequately manage the credit risk, the National Bank also undertakes systemic measures, as the introduction of countercyclical capital buffer,” Angelovska-Bezhoska said.

The governor also referred to the World Economic Outlook, which was published by the IMF at the beginning of the Meetings. According to the basic scenario within the IMF's April projections, the growth of the global economy in 2023 is expected to slow down compared to the previous year, especially in developed economies, while next year it would moderately accelerate, so that in the medium term it would remain at around 3 percent, which is the lowest mid-term rating in the past few decades.

“Risks to global economic growth are mainly on the downside and are associated with turmoil in the financial sector, worsening financing conditions, declining consumer and investor confidence, and the development of the military situation in Ukraine. Household consumption and low unemployment rates in labor markets, which can have a positive impact, as well as greater resilience of the global economy, are cited as positive aspects. Our small and open economy will be influenced by global developments, especially the EU economy, which is our biggest trading partner," Angelovska-Bezhoska said, adding that the National Bank is finishing the spring projections, which will be presented next month.

Photo: National Bank