The National Bank of the Republic of Macedonia Council revised several issues within its operating area at its session held today.

Skopje, 29 September 2005

Press release of the NBRM

The National Bank of the Republic of Macedonia Council revised several issues within its operating area at its session held today.

The Council adopted decisions on introducing repo transactions for conducting monetary policy in practice. The have several privileges, since they provide larger flexibility and safety for the counterparties, they are realized in real time and they are costless. These decisions enable approving both overnight and intraday credits through repo transactions. In order to provide more efficient liquidity planning and management in the banking system, changes in the period of holding CB bills auction were made, with the prospectus of the CB bills auctions being published in the same day of holding the auction.

The Council reviewed the latest macroeconomic movements in the Republic of Macedonia stating that in the January - August 2005 period the price stability was as preserved, with the average rate of inflation (measured through the consumer price index) being equal to 0.3%. The total deposit potential of the banks in August 2005, compared to the same month of the previous year, rose by 15.1%. The broad deposit base of the banks causes further increase in the banks' credit activity. Thus the credits of the private sector registered an annual increase of 22.3% (August 2005 / August 2004). At the end of August 2005, compared to December 31, 2004, the gross foreign reserves augmented by Euro 105.9 million, mainly as a result of the higher net purchase of foreign currency on the foreign exchange market by the NBRM. In the January - June 2005 period, the deficit on current account of the balance of payments equals Euro 89.3 million, which is a significant decrease of Euro 140.8 million compared to the same period of 2004, caused by the improvement in all main current account components.

Governor's Office