Skopje, 20 February 2022 (MIA) — The exchange rate of the denar is stable, the foreign reserves increased last year, and the banking system also remains stable. Domestic demand is the main factor of the economic growth while the monetary policy is still relaxed to provide enough room for continuous economic recovery, the National Bank said in a press release on Standard & Poor's credit agency confirming the credit rating of the country, “BB-”, with a stable outlook, in its latest report. "The report of the credit agency states that there are no changes in the fixed exchange rate of the denar, while the foreign reserves increased by 8.4% last year. The growth of the foreign reserves, which reached EUR 3.6 billion in 2021 and this level of the foreign reserves enables enough foreign currency liquidity for maintaining the stability of the exchange rate of the denar. "The rating agency notices that there is also an additional protective mechanism i.e. that the National Bank has a possibility to provide additional liquidity in euros through the repo line of Euro 400 million, that the European Central Bank granted to the National Bank, until March this year. So far, this possibility has not been used, but it can be used in case of materialization of external risks," the press release says. The central bank says that Standard & Poor's has noticed  the movement of the inflation rate was the result of external factors, such as the growth of energy and food prices. "They expect these pressures to stabilize in 2022, as a result of a slowdown in food prices. The credit agency expects the inflation rate in the country for this year to be 2.6%, for next year 2% and for 2024 and 2025 1.8% and 1.5%, respectively," the release adds, noting that Standard & Poor's has also pointed out that the banking sector is stable. mr/