CRO CENTRAL BANK: SIGNIFICANT INCREASE MARKED IN INDUSTRIAL PRODUCTION

ZAGREB, July 26 (Hina) - The new Council of the Croatian National Bank (HNB) on Wednesday held its first working session under the chairmanship of Zeljko Rohatinski. Discussed at the session were the latest economic and financial developments, HNB officials reported. In the latest economic developments, particularly significant was the increase of the production (in the fist half of the year by 2.9 percent in relation to the same period the year before), and data on the tourist development, which are more favourable than it was earlier expected. It is estimated that the foreign exchange inflow from tourism could be 22 percent greater than the year before. For the HNB, this means a possibility of strengthening international reserves, which now amount to over US$3.5 billion. The kuna exchange rate is currently exposed to the appreciation pressure, but without major oscillations. Retail prices in June were 7 percent greater that in the same month 1999, however, data point to the fact that new prices of liquor, tobacco and oil products, as well as transport services had the crucial role in that period, therefore lower inflation rates could be expected. Lately, interest rates at the interbank money market were very low, both for over-night loans and three-months loans, which is a proof of a good solvency in the bank system. (hina) it mm