ZAGREB, Oct 3 (Hina) - The Croatian National Bank (HNB) Council held a session on Thursday under the chairmanship of Governor Zeljko Rohatinski at which it discussed monetary and economic movements in the past three months and adopted
a monetary policy projection for the last quarter, the central bank said in a statement. Based on a 4.5% increase in economic growth in this year's first half and available indicators from the third quarter, the central bank's analysts expect this year's real increase of Gross Domestic Product will amount to 4.2%, which exceeds expectations. A 1.8% rise in prices in August has had a decisive effect on price movements, which could result in a somewhat higher annual inflation rate than expected, despite less dramatic price movements in the last quarter. Thanks to interventions by the central bank into the foreign exchange market and other measures aimed a
ZAGREB, Oct 3 (Hina) - The Croatian National Bank (HNB) Council held
a session on Thursday under the chairmanship of Governor Zeljko
Rohatinski at which it discussed monetary and economic movements in
the past three months and adopted a monetary policy projection for
the last quarter, the central bank said in a statement.
Based on a 4.5% increase in economic growth in this year's first
half and available indicators from the third quarter, the central
bank's analysts expect this year's real increase of Gross Domestic
Product will amount to 4.2%, which exceeds expectations.
A 1.8% rise in prices in August has had a decisive effect on price
movements, which could result in a somewhat higher annual inflation
rate than expected, despite less dramatic price movements in the
last quarter. Thanks to interventions by the central bank into the
foreign exchange market and other measures aimed at preventing
speculative behaviour, oscillations in the exchange rate have
calmed down and the trend of slight decrease of banks' interest
rates has not been discontinued.
Foreign exchange reserves enable the central bank to continue
maintaining a satisfactory degree of stability of the national
currency.
An important factor determining the monetary policy in the fourth
quarter will be the amount of the budgetary deficit and its
coverage. This will significantly influence the continuation of
monetary unification and further decrease in obligatory reserves.
The reliability of the projection for the last quarter will also
depend on international developments, particularly the dollar-
euro relation, as well as on the amount of the influx of foreign
currency deposits from households into banks, due to the change to
the euro.
(hina) rml