Skopje, 16 February 2022
The National Bank conducts an appropriate relaxed monetary policy because inflation is primarily a global phenomenon. In accordance with the global trends, the higher inflation will probably be maintained longer in relation to the previous expectations, dropping in the second half of 2022. In the coming period, the National Bank should carefully monitor the developments and potential risks, emphasizing the readiness to respond if necessary. This is concluded by the International Monetary Fund (IMF) in the Report of the regular mission in the country.
The Fund notices that the fixed exchange rate of the domestic currency has been an anchor of the stability of the domestic economy for decades, and it points out that the foreign reserves are maintained at an appropriate level and enable sufficient room for maintaining the exchange rate stability.
The IMF report also presents assessments of several other aspects in the field of the central bank.
The timely and strong response of the National Bank mitigated the blow that the pandemic delivered to the economy, and helped in the economic recovery. As pointed out by the IMF, the regulatory flexibility during the pandemic was substantially used and helped both credit beneficiaries and banks to overcome the liquidity challenges.
The National Bank measures contributed to preserving the financial stability. The current reforms for strengthening of the macro-prudential framework and for the protective financial network are key.
The banking system is well capitalized. In September 2021, the capital adequacy ratio exceeded 17%, supported by the solid capitalization before the pandemic and the National Bank measure for a temporary limitation on the payment of dividends by banks. The stress tests of the National Bank show that the levels of capital of the banking system will be above the minimum requirements also in a risky scenario.
The National Bank is a highly transparent and accountable institution. In order to provide timely decisions and to preserve the operational autonomy as a supervisor, it is of highest interest to maintain the independence of the central bank, the IMF points out. In accordance with the recommendations of the Financial Sector Assessment Program (FSAP) of the IMF and the World Bank from 2018, in the report, the Fund points out that the National Bank should be excluded from the Law on Administrative Servants.
The National Bank has an appropriate framework of internal mechanisms for decision-making and for implementation of the activities. This was concluded in 2020, when an IMF mission also carried out a check on the internal control mechanisms in the National Bank. Also in this case, the IMF pointed to the need for amendments to the legal framework in order to strengthen the independence of the National Bank.