Skopje, 15 May 2024
Further inflation slowdown, returning to the historical average of 2% in the medium term
The Governor Anita Angelovska Bezhoska presented the most recent macroeconomic forecasts of the National Bank to the diplomatic corps and the representatives of the international institutions. The event, organized regularly after each new round of macroeconomic forecasts of the National Bank, was attended by representatives of the International Monetary Fund (IMF), the World Bank (WB), the Delegation of the EU, the United Nations (UN), the United Nations Development Programme (UNDP), as well as of the diplomatic representative offices of Bulgaria, China, Kosovo, the USA, Slovakia, Hungary, the Netherlands, Switzerland, Spain and Sweden.
As pointed out in the presentation, further slowdown of inflation is expected, which last year reduced to a one-digit level, in accordance with the performances in the first quarter of this year, with an average rate of 3.4%, which were lower compared to the October forecasts. The average inflation is forecast to slow down to 3.5% in 2024, from 9.4% last year, reflecting the decline in global oil and food prices, the slowdown in foreign effective inflation, and tight financial conditions. In the medium term, inflation is expected to further slowdown and to reduce to the historical average of around 2%.
However, inflation risks still exist and are mainly related to commodity prices, changes in regulated prices, as well as to the demand-side policies. Additionally, the Governor pointed out that determination for prudent monetary policy is currently maintained, while future changes will depend on the trends of the foreign exchange market and inflation movements and expectations, as well as on the ECB setup.
Referring to other macroeconomic indicators, the Governor pointed out that amid growth in global economy, especially in our trading partners, the Macedonian economy is expected to grow at a rate of 2.6% this year and 3.6% next year, and afterwards to moderately accelerate in the medium term. Amid forecast of solid net inflows in the financial account that would exceed the moderate current account deficit, further growth of foreign reserves is expected, as a guarantee for the exchange rate stability.
The global conditions remain uncertain and unpredictable, creating risks to economic growth, inflation and the external position, underscoring the need for prudent domestic macroeconomic and structural policies. The National Bank will further vigilantly monitor macroeconomic data and risks on a day-to-day basis and as before, will deploy all necessary measures and available instruments to maintain exchange rate and medium-term inflation stability.