Skopje, 3 December 2022

The National Bank responds accordingly to the pressures that are transferred from the international markets of primary commodities, i.e. primary food products and energy, on domestic prices and move inflation upwards. Uncertainty remains high, hence the National Bank should continue to monitor the international and domestic developments and if necessary, to respond accordingly. This was pointed out at the meeting between the Governor of the National Bank, Anita Angelovska Bezhoska, the World Bank Country Director for the Western Balkans, Xiaoqing Yu, and the World Bank Country Manager for North Macedonia, Massimiliano Paolucci. 

Subject matter of the meeting were the autumn macroeconomic forecasts of the National Bank, which take into account the deteriorated global environment, as a result of the further geopolitical tensions arising from the military invasion of Russia over Ukraine, the COVID-19 pandemic and the further pressures on the prices of primary products in world markets. In accordance with this, in the October forecasts of the National Bank, inflation has been revised upwards, in conditions of upward adjustments of the estimates for import prices, i.e. to 14.3%. For the following year, a decrease in import prices is expected, which would also reduce the pressures on domestic inflation and in the absence of major pressures from demand, it is expected that the average inflation rate will be more moderate, i.e. 8% - 9%. The medium-term expectations are that inflation will significantly slow down, reducing to 2.4% in 2024 and will return to the historical average of 2% in 2025.

The Governor of the National Bank emphasized that we are among the central banks that responded first to the global inflation developments, i.e. at the end of 2021, by withdrawing liquidity through interventions on the foreign exchange market. Furthermore, the key interest rate has been increased several times with a total effect of growth of 3 percentage points. In addition, several measures have also been adopted, such as the changes in the reserve requirement due to higher denarization, as well as support to energy sustainability projects, but also introduction of a countercyclical capital buffer for banks.