Skopje, 31 January 2024 (MIA) - The interest rate on CB bills remains to the level of 6.30%, and the overnight and seven-day loan interest rates remain at 4.20% and 4.25%, respectively. The supply of CB bills at the regular auction remains unchanged and amounts to Mden 10 billion, the National Bank’s Operational Monetary Policy Committee decided on Tuesday.

According to the National Bank, the Committee decided that the maintenance of the current level of interest rates, together with the changes to the reserve requirement and the macroprudential measures taken so far, will contribute to further slowing down inflation and keeping the exchange rate stable. 

The central bank notes that the latest decision on the monetary policy is based on the need to stabilize inflation expectations and inflation on a more permanent basis, while also taking risks into account.

"Domestic inflation stands at 3.6% on an annual basis in December 2023, seeing ease of pressure in the food and energy prices, as well as slower price pressure in terms of less volatile categories, in accordance with the monetary measures taken. In conditions of similar inflation trends in our country and in the Eurozone, the difference in annual rates is small. The inflationary expectations of consumers expressed in the December polls of the European Commission are also more moderate. The average domestic inflation rate eased to 9.4% in 2023, in line with the expected rate of 9.5%," said the central bank.  

However, it adds, the average inflation rate is still at a relatively high level, compared to the historical average. Risks regarding future dynamics of prices still exist, regarding which, in addition to the uncertainty of the movement of prices on the world stock markets, certain domestic factors also contribute. Hence, further caution is needed, including with regard to policies that affect the demand side of the economy. Regarding the policy of the European Central Bank (ECB), at the latest session in January, a decision was made to keep interest rates at the same level, the National Bank said. 

"In general, latest data on key macroeconomic indicators move mostly in line with expectations. However, the conditions for conducting the monetary policy are still uncertain and require further careful monitoring of the dynamics and factors of inflation and inflation expectations. Hence, further caution is needed in conducting monetary policy, i.e. in conducting macroeconomic policies that affect demand in the economy. The National Bank is prepared to use all the necessary instruments and to take measures that will contribute to maintenance of the stability of the exchange rate, stabilization of inflation expectations and to medium-term price stability," reads the press release.  

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