Skopje, 4 November 2022
It takes time to feel the proper effects of the monetary policy tightening, especially if it takes place gradually, in conditions of no significant pressures on the demand side and in the direction of maintaining stability. However, in recent months, the interest rates on the denar deposits start registering an upward movement, the Vice Governor of the National Bank, Emilia Nacevska said in an interview for Bankarstvo.mk.
She said that in order to maintain medium-term price stability, which is actually the goal, the central banks of almost all economies in the world are working to stabilize inflationary expectations caused by the current global crisis, through the tightening of monetary policy, i.e. by raising the policy rate, which acts on demand-side pressures. Ensuring price stability is crucial for maintaining macroeconomic stability and supporting economic growth.
"The aim of these policies is to primarily anchor the inflationary expectations. The whole process is conducted gradually, analyzing in detail all the data and movements both globally and nationally with the macroeconomic and financial stability being set as a priority. The banking sector is stable, adequately capitalized and provides adequate support to the private sector," Nacevska said.
In the interview, Nacevska stressed that the increase in the policy rate is supplemented by measures for changes in the reserve requirement system, in order to encourage denarization, i.e. the denar savings, leaving space to the banks so that they can offer more favorable interest conditions for denar deposits. In the interview, the Vice Governor also denotes the security that the long-used strategy of a stable nominal exchange rate of the denar against the euro provides for both economic entities and households, with the National Bank staying committed to this goal.
"The reserve requirement corrective measures for the purpose of greater denarization and higher interest rates on denar deposits would contribute to increase the savings in denars. It is expected that in the medium term the trend of deposit growth will continue", the Vice Governor said, emphasizing that as of September, the deposit growth equals 3.4% annually, which is mainly due to the deposit growth in the household sector of 5, 3%.