MONETARY TRANSMISSION MECHANISM THROUGH THE INTEREST RATE CHANNEL IN THE REPUBLIC OF NORTH MACEDONIA
MONETARY TRANSMISSION MECHANISM THROUGH THE INTEREST RATE CHANNEL IN THE REPUBLIC OF NORTH MACEDONIA

Summary/Abstract: The monetary policy of the central bank plays an important role, which is even further increased in times of crises. This paper examines the efficiency of the monetary transmission mechanism through the interest rate channel in the Republic of North Macedonia. The research of the efficiency of the monetary transmission mechanism is carried out with the statistical methods of simple linear correlation and regression. Moreover, this paper examines the impact of the changes in the interest rate of the central bank treasury bills, on the interest rates of the interbank deposit market, and, then the transmission to the interest rates of the loans issued by the commercial banks. The results indicate a slight difficulty in the functioning of the transmission mechanism through the interest rate channel in the country, since the commercial banks do not take immediate actions upon the monetary signals sent by the National Bank through the main instrument of the open market operations. The causes for this situation can be found in certain specific characteristics inherent to the Macedonian banking sector

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