Governor Trajko Sllaveski has expressed the view that elevated interest rates are preferable to the persistent threat of rising inflation. Addressing recent concerns regarding potential increased provisions from three major bank institutions and one smaller bank, Sllaveski stated that the People’s Bank does not see a justification for such an escalation. The People’s Bank recently increased the base interest rate by 0.25 percentage points, setting the new benchmark at 4.25%, an increase from the previous 4.00%.
This adjustment signals to other commercial banks that they may also raise their lending rates. However, Governor Sllaveski clarified that the ultimate decision rests with the individual commercial banks, and the full impact of this policy measure is typically observed with a delay. Sllaveski also noted a trend observed since the start of the year, citing increased demand for foreign currency originating from the corporate sector as a contributing factor to the current economic environment.
These factors underscore the ongoing adjustments within the financial sector as monetary policy navigates inflationary pressures.
Topics: #interest #rates #bank
