Skopje, 7 May 2026 (MIA) - The National Bank has projected the 2026 inflation at 4 percent while the GDP growth at 3.5 percent. For 2027, the central bank projects the inflation at 3 percent and the GDP growth reaching 3.8 percent.

The National Bank Council reviewed and adopted Thursday the latest macroeconomic projections included in its quarterly report, which states that the global economy is facing significant risks.

According to the report, geopolitical conflicts continue to be the main source of uncertainty, primarily developments in the Middle East, which have a significant impact on the prices of primary products and trade flows.

Latest macroeconomic projections for the domestic economy rely on a moderate scenario, according to which the conflict is expected to end soon, with oil supply getting back to normal and prices gradually reducing in the second half of the year.

According to these projections, inflation is expected to stand at about 4 percent in 2026, with stabilization to be slower amid higher energy and food prices. Inflation is expected to gradually reduce to nearly 3 percent in 2027, followed by its return to the historic average of 2 percent in the medium term, the National Bank said in a press release.

In the current circumstances, projections for the domestic economy point to a moderate but stable economic recovery. The GDP growth is expected to reach 3.5 percent in 2026 and accelerate to 3.8 percent in 2027. Investments, primarily public infrastructure projects, will continue to be the main generator, along with the gradual recovery of foreign demand.

The economy's external position is assessed as unfavorable in the short term. The current account deficit is expected to stand at 5.7 percent of GDP in 2026, affected by higher energy imports and investment activities. It is expected to gradually reduce in the medium term, driven by steady financial inflows that would finance the deficit and further increase foreign currency reserves.

The banking system continues to provide solid support for the economy. In Q1, lending activity rose annually by 13.1 percent amid expectations for a moderate slowdown by the year-end. In the medium term (2027-2028), loans are expected to rise by about 7.4 percent on average.

The National Bank remains prepared to use all the available instruments and if necessary, will take appropriate measures for maintaining the stability of
the exchange rate of the denar against the euro and for providing the medium-term price stability.

Photo: National Bank and MIA