North Macedonia Maintains Key Interest Rate at 5.35%

The National Bank of North Macedonia kept its benchmark interest rate at 5.35% for a fifth consecutive meeting in September 2025, maintaining a cautious monetary policy stance amid steady domestic growth. Headline inflation eased to 4.4% in August from 4.8% in July, driven by basic goods and food, though risks remain from global uncertainties and commodity price volatility. GDP expanded 3.4% in Q2, the fastest pace in three years, supported by household consumption and gross investment, while net exports contributed slightly negatively. The foreign exchange market remained stable with €4.75 billion in reserves and ongoing central bank interventions. The cautious policy is reinforced by macroprudential measures, including adjustments to reserve requirements, tighter credit standards, and an increase in the countercyclical capital buffer, reflecting a balanced approach to price stability, exchange rate stability, and systemic risk mitigation.