The National Bank of the Republic of Macedonia Council discussed on several issues within its operating area on the session held today.
Press release of the NBRM
The National Bank of the Republic of Macedonia Council discussed on several issues within its operating area on the session held today.
The members of the NBRM Council were informed on the discussions with the IMF held during the last mission, with the conclusion of the IMF team for fulfillment and surpassing of all targets envisaged by the arrangement within the NBRM competence as of the end of September and favourable current tendencies which tend to be surpassed also at the end of the year being emphasized. The macroeconomic projections for 2007 were discussed with the IMF team.
The NBRM Council was informed also on the latest macroeconomic movements in the Macedonian economy. Namely, in the January - October 2006 period, average rate of inflation of 3.2% was registered, mainly caused by the increase in the excises of cigarettes in the beginning of the year, the higher prices of food products and energy sources. No larger changes in the inflation are expected until the end of the year. The favourable movements on the foreign exchange market continue, enabling continuing increase in the gross foreign reserves of the NBRM. In environment of higher inflows in the economy originating from private transfers from abroad, which neutralized a significant part of the trade deficit, deficit of only Euro 4 million in the first eight months of 2006 was registered (which is lower compared to the same period of the preceding year by Euro 58 million). On the latest auctions of CB bills, the average interest rate maintained at the level of 5.6%. In October, additional intensification of the growth of the total deposits and the total bank placements with the private sector were recorded. Thus in October 2006, compared to the same period of the previous year, the total deposits of the private sector went up by 26.4%. Simultaneously, the annual increase in the total bank placements extended to the private sector equals 28.1% in October 2006.
The Council adopted a decision on submitting data on the balance of the Denar cash of the banks. The development of the money markets, the gradual establishment of the securities portfolio by the banks, the payment system reform, as well as the implementation of indirect market instruments imposed a need of creating new set of market information the banks submit to the National Bank. Consequently, the significance of the data which are collected according to the Decision on submitting daily data from banks and savings houses lessened, because of which the requirement for banks and savings houses to submit these data was revoked. However, only the requirement for submitting data on the balance on the account 101 - cash in vault (including also the cash in the bank's vault) remained, which as an autonomous factor is necessary for liquidity planning and management by the National Bank.
The National Bank of the Republic of Macedonia Council adopted a Decision on initiating a procedure for issuing coins in denomination of Denar 10 and 50. The main features of the new coins and the date of their release shall be determined additionally by a special decision of the Council. The Decision is adopted on the basis of analysis of the expenses the National Bank born until now for issuing banknotes in denomination of Denar 10 and 50. These banknotes participate with 52% of the total number of banknotes in circulation and their economic life lasts from 1 to 1.5 years, while the annual expenses for their production amounts to Denar 20 million. With the issuance of coins in denomination of Denar 10 to 50, the utilization period of which will be significantly longer than that of the banknotes in the respective face value, it is assessed that the annual saving would amount from Denar 11 to 12 million.