ZAGREB, Oct 13 (Hina) - The Croatian National Bank (HNB) Council said Wednesday the basic indicators of macroeconomic stability in Croatia were still satisfactory. The annual retail price increase is 4.7 per cent and the annual cost
of living rises 3.9 per cent annually. The kuna currency rate is maintained within acceptable margins. The kuna currency rate has lessened by 4.17 per cent during the first eight months of this year. Gross foreign exchange reserves on HNB accounts have reached a record US$3.15 billion, and net foreign exchange reserves have been refilled to excess of US$2 billion. The increased level of liquidity of the kuna caused a fall in interest rates on the money market, especially in transactions among the most stable banks. Interest rates for such transactions has fallen from about 11 per cent to 6.75 per cent. It is concerning, however, that the macroeconomic stability is not followed by desir
ZAGREB, Oct 13 (Hina) - The Croatian National Bank (HNB) Council
said Wednesday the basic indicators of macroeconomic stability in
Croatia were still satisfactory.
The annual retail price increase is 4.7 per cent and the annual cost
of living rises 3.9 per cent annually. The kuna currency rate is
maintained within acceptable margins. The kuna currency rate has
lessened by 4.17 per cent during the first eight months of this
year.
Gross foreign exchange reserves on HNB accounts have reached a
record US$3.15 billion, and net foreign exchange reserves have been
refilled to excess of US$2 billion.
The increased level of liquidity of the kuna caused a fall in
interest rates on the money market, especially in transactions
among the most stable banks. Interest rates for such transactions
has fallen from about 11 per cent to 6.75 per cent.
It is concerning, however, that the macroeconomic stability is not
followed by desirable trends in the economy.
In the past eight months, industrial production has decreased by
2.8 per cent in comparison to the same period last year.
Retail sales have decreased by 7.4 per cent and tourist over-night
stays by 15.8 per cent, while biannual results say 13.6 per cent of
passengers and 12.1 per cent of goods less than in the first half of
last year.
Trade is one per cent less than in the first half of last year, which
is caused by the lower level of foreign transactions.
August was this year's first month in which state budget earnings
were larger than expenditure.
Counting on earnings from the sales of a part of Croatian
Telecommunications shares, the budgetary deficit at the end of this
year will probably not pass one per cent of the gross domestic
product.
The HNB warned that maintaining stability will not be possible
unless changes occur in the trends of increasing public expenditure
and salaries which are not covered by production.
The HNB held that as large an amount of profits from privatisation
as possible should be directed towards initiating and development
of competitive products for exports.
(hina) lml jn