Skopje, 21 December 2023

The relaxation of the monetary policy in the period ahead will depend on three factors - the movement in inflation, in the foreign exchange market, as well as the policy of the European Central Bank, taking into account the fixed exchange rate of the denar against the euro. The Governor of the National Bank, Anita Angelovska Bezhoska in an interview for MTV, points out that the trends in inflation and the foreign exchange market are favorable, with growth of foreign reserves to the level of Euro 3.9 billion, but that inflation is still at a higher level than the historical average, as well as that there are still risks from the external and domestic environment, which indicates vigilance when setting the monetary policy.

The Governor points out that currently, there is no more massive trend of relaxation of the monetary policy of central banks, although it exists in some economies. “The central banks of the most developed economies, which mostly affect the international financial markets, for now, maintain the same monetary setup, but it is also important to emphasize that they did not continue to further increase their policy rates”, Angelovska Bezhoska says and she adds that the ECB in its latest report states that it expects that the same interest rates will be maintained for a longer period of time, for the purpose of longer-term stabilization of inflation expectations and inflation. “However, on the other hand if one looks at the expectations of the financial markets, they already incorporate a certain decline in interest rates”, the Governor says.

Referring to the situation in the domestic markets, she underlined that the global trend of growth of interest rates in support of reduction of inflation was also present in our country, as a result of the tightening of the monetary policy. “However, if we compare the increase in interest rates in our country, the increase in interest rates in the EU resulted in a smaller increase in our country. Hence, if on average in history, the household borrowing in our country was more expensive by 2 to 3 percentage points compared to the EU, now the interest rates are almost equaled. The further financial setup and the cost of borrowing, as before, will depend on a large number of factors, on the condition of the banking system, liquidity, competition in the banking system, risk perceptions, disposable income of households, but also on the future monetary policy setup”, the Governor Angelovska Bezhoska concludes.