May 16 (SeeNews) - North Macedonia's central bank said on Monday it expects the country's economy to expand by 2.9% in 2022 and 3.6% in 2023, revising downwards its October projections.
Domestic demand will positively contribute to North Macedonia's economic growth in 2022, although to a more moderate degree due to the lower household consumption, while net exports are expected to have a negative contribution, the central bank said in a press release.
The central bank added it is raising its average inflation forecast for 2022 to 8.8% from the previously expected 2.4%, reflecting the rising global prices of primary products and disruptions in global supply chains. For 2023, the central bank projects an average annual inflation of 3%.
However, projection risks are assessed as downward and are mostly related to the course of the conflict between Russia and Ukraine, the statement read.
In October, the central bank projected an economic growth of 3.9% and 4% in 2022 and 2023, respectively.
Last week, North Macedonia's central bank hiked its policy rate by 0.25 percentage points (pp), to 1.75%, after increasing it by 0.25 pp in April, to combat inflation.