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N. Macedonia's c-bank holds policy rate at 1.25%

N. Macedonia's c-bank holds policy rate at 1.25% The National Bank of the Republic of Macedonia Licence: Public Domain

SKOPJE (N. Macedonia), October 13 (SeeNews) - North Macedonia's central bank decided to keep its policy rate unchanged at the historically lowest level of 1.25%, as it sees the current monetary policy stance as adequate to the economic and financial conditions, it said on Wednesday.

For the time being, there is no need for a monetary reaction to the price movements as they stem from factors on the supply side, not on the demand side, the central bank said in a statement.

The central bank also decided to offer 10 billion denars ($187.2 million/161.9 million euro) worth of central bank bills at an auction on Wednesday, unchanged in comparison with the amount offered at the last auction held on September 15. The central bank's policy rate is the interest rate on the central bank bills.

North Macedonia's gross domestic product (GDP) increased by 5.2% on the year in the first half of 2021, slightly less than the central bank's projected economic growth of 5.4% for the period. The data available for the third quarter of 2021 mainly point to a continued economic growth, although more moderate compared with the second quarter, the central bank said.

In terms of inflation, the average annual increase of consumer prices in the January-September period is 2.8%, slightly above the expected rate.

The central bank said in May it expects the country's economy to grow by 3.9% in 2021, while the end-2021 inflation is projected at 2.2%.

North Macedonia's GDP fell by 4.5% in 2020, according to preliminary data issued by the country's statistical office.

The central bank last changed its policy rate in March, when it slashed it by 0.25 percentage points.

(1 euro = 61.77 denars)