Statement of the National Bank Governor to the Factor portal

Skopje, 23 June 2020

In all previous crisis episodes, a stable Denar exchange rate has been a major factor in maintaining macroeconomic stability. There is no compromise over the current rate regime. The public should have full confidence in our commitment and capacity to successfully continue with the existing monetary strategy of a stable Denar exchange rate.

This was stated by the National Bank Governor Anita Angelovska Bezhoska, in a statement to the Factor portal. She points out that both the international financial institutions and the central bank have repeatedly stressed that this monetary strategy fully corresponds to the structural features of the Macedonian economy and the commitment to economic and monetary integration in the European Union. "Undoubtedly, a social consensus has long been reached on this issue", stresses Angelovska Bezhoska.

In a statement to Factor, the governor also briefly comments on the speculation about the Denar exchange rate. She points out that the speculations about the Denar exchange rate are nothing new. Unfortunately, they are present whenever we face a shock.

"The speculative claims related to the Denar exchange rate are not supported by economic arguments. In conditions when the foreign reserves adequacy is confirmed by all relevant indicators, it is irrational to talk about changes to the exchange rate", says Angelovska Bezhoska.

She emphasizes that not only the high level of foreign reserves is the guarantee of exchange rate stability, but also the broad set of instruments at the central bank’s disposal to defend the exchange rate, if necessary.  

"From an economic viewpoint, any change to the exchange rate cannot be beneficial to the economy as a whole. On the contrary, "it can only increase payment liabilities on foreign currency debt, reduce purchasing power due to rising prices and make imports more expensive", says the governor.

"Notably, in the past few years, the National Bank has been constantly purchasing the excess foreign currency on the foreign exchange market, thus naturally increasing foreign reserves. No one has ever speculated about the increase in the denar value, which shows that unfortunately, the attempts to impose a debate on the Denar exchange rate has not always been economic", says Angelovska Bezhoska.

In the statement to Factor, she is adamant that the public should be calm - the denar remains stable.

The assessment that the National Bank monetary strategy for the Denar exchange rate is appropriate for the Macedonian economy has also been confirmed by the IMF. Recently, this has been also confirmed by the head of the IMF Mission to our country, Bergljot Bjornson Barkbu, and the IMF Resident Representative for the Western Balkans, Stephanie Eble. They stressed that the Denar exchange rate is the key anchor of macroeconomic policies.

The governor's statement to "Factor" is available here.