Skopje, 12 October 2022 (MIA) – Interest rate of central bank bills is increased by 0.5 percent and now stands at 3.5 percent, the National Bank’s Operational Monetary Policy Committee has decided. The committee also decided to raise the overnight and seven-day loan interest rates by 0.5 percent. The decision took into account the upward inflationary trends that accelerated in September due to the food and energy component. Furthermore, considering the monetary strategy of a stable Denar-Euro exchange rate, changes in the domestic monetary policy reflect the changes in the monetary policy of the European Central Bank, says the National Bank. It adds that domestic inflation continues to be largely determined by outside factors, i.e. rise of import prices of food and energy resources, including on the domestic price of electricity and heating energy. “About 80 percent of the inflation rate in September and 75 percent of the inflation in the first nine months of 2022 is owed to the rise in prices of food products and energy. The longer-term pressure of these prices as a result of unpredictable outside factors and their transferrable effects on the prices of the other products and services fuels the inflation expectations of economic entities. Therefore, precautionary domestic policies are required for the purpose of caution in managing demand. Although there is visible downward adjustment in food prices at global markets, the upward pressure of energy prices slows down the transfer of these trends in prices at the domestic market,” says the central bank. Foreign currency reserves have recorded a rise that has exceeded projections in September. Reserves are in the safe zone and meet the adequacy requirements in line with international standards. The gross domestic product (GDP) increased by 2.8 percent in the second quarter, in line with bank projections. “Nevertheless, data in Q3 point to a slowdown of the real economic growth, which alongside the downward revisions of foreign demand due to the effects of the military conflict in Ukraine and the rising energy crisis, highlight the downward risks for growth in the coming period,” says the bank. The bank is closely monitoring macroeconomic data and associated risks, undertaking all required measures and instruments at disposal to maintain stability of the foreign exchange rate and mid-term price stability.