The National Bank has decided to maintain its current monetary policy stance, keeping interest rates unchanged amidst concerns about inflation and global economic uncertainties. The decision was made during a regular session of the Executive Board, where the latest economic data and market developments were reviewed.

The interest rate on treasury bills will remain at 5.35%, while overnight and 7-day deposit rates will stay at 3.95% and 4%, respectively. The supply of treasury bills at regular auctions will also remain at 10 billion denars.

This decision reflects a cautious approach to monetary policy, aiming to strengthen price stability and preserve the stability of the denar exchange rate against the euro. The current mix of interest rates, reserve requirements, and macroprudential measures is designed to achieve these goals.

Inflation remains a key concern, with the annual rate accelerating to 3.3% in May 2025, primarily due to rising food prices following the expiration of price control measures. While the core component of inflation has slowed and energy prices continue to decline, the overall inflation performance is slightly above expectations, indicating potential prolonged effects and the need for vigilance.

Uncertainty surrounding future primary product prices, driven by geopolitical tensions and climate change, also poses risks to inflation. Domestic factors affecting demand are being closely monitored as well.

The foreign exchange market remains stable, with foreign exchange reserves at EUR 4,691.1 million at the end of May. Recent data suggests solid net inflows from private transfers and a slightly lower trade deficit in April.

Economic activity grew by 3.0% in the first quarter of 2025, consistent with previous quarters. Limited data for the second quarter shows growth in industrial production but a decline in total trade turnover in April. Downward risks to growth persist from the external environment, along with domestic risks related to the implementation of infrastructure projects.

The monetary sector continues to show strong credit support to the economy, with deposits and loans recording solid growth rates in May, slightly exceeding expectations.

The National Bank emphasizes its readiness to utilize all necessary instruments and take appropriate measures to maintain the stability of the denar exchange rate and price stability in the medium term.