ZAGREB, June 12 (Hina) - The Croatian National Bank (HNB) Council on Wednesday discussed the latest economic and monetary movements at a session held under the chairmanship of HNB governor Zeljko Rohatinski.
ZAGREB, June 12 (Hina) - The Croatian National Bank (HNB) Council on
Wednesday discussed the latest economic and monetary movements at a
session held under the chairmanship of HNB governor Zeljko
Rohatinski. #L#
Macro-economic stability is still being successfully maintained,
reads a statement the Council issued after the session. In the first
five months of 2002, retail prices increased by 1.9 percent in
relation to December last year. The basic inflation rate, which
does not include the prices of power products and seasonal
products, and the prices that are determined by the state, was 0.7
percent in the first five months. It is on this fact that the HNB
bases its estimate of a lower inflation rate in relation to last
year.
After the influx of foreign currency, caused by the conversion to
the euro, ebbed down, the kuna saw a period of depreciation in
January, which was soon followed by appreciation.
The central bank has intervened in the foreign currency market on
several occasions, purchasing a total of around 500 million euros.
The bank's net international reserves now total slightly more than
four billion US dollars.
Commenting on occasional objections that the reserves were not used
sufficiently for development, the HNB Council said that the HNB was
purchasing foreign currency on the market by issuing kuna, which
directly enter the financial system and support the growth of bank
loans. In the first four months of this year, loans granted to the
economic sector increased by 8.1 percent in relation to the same
period last year. Loans granted to citizens rose by 12.2 percent. In
2001 the central bank issued 7.5 billion kuna through interventions
on the foreign currency market, and according to current estimates,
this year's issue will be even higher. By intervening into the
foreign currency market the central bank also prevents the
appreciation of the kuna. This is enabled also by the net foreign
currency influx from privatisation revenues and foreign loans,
reads the statement.
(hina) rml sb