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Households’ euroization in the Republic of North Macedonia: Is it close or far from the optimal levels?

Author

Listed:
  • Tanja Jakimova

    (National Bank of the Republic of North Macedonia)

  • Milan Eliskovski

    (National Bank of the Republic of North Macedonia)

  • Artina Bedzeti Baftijari

    (National Bank of the Republic of North Macedonia)

Abstract
The paper deals with the challenges stemming from the phenomenon of unofficial euroization in the Republic of North Macedonia. It tries to identify the main drivers of the households’ deposit euroization in the Republic of North Macedonia and contributes to the literature by providing an empirical measure of optimal level of euroization. With focus on the household deposits, it is an additional attempt to empirically estimate the optimal level of euroization in the Republic of North Macedonia, following an already published IMF study on this issue. Looking ahead, persistence in stability-oriented macroeconomic policies and measures for promotion of the use of local currency could further support the de-euroization trend in the Republic of North Macedonia.

Suggested Citation

  • Tanja Jakimova & Milan Eliskovski & Artina Bedzeti Baftijari, 2022. "Households’ euroization in the Republic of North Macedonia: Is it close or far from the optimal levels?," Working Papers 2022-02, National Bank of the Republic of North Macedonia.
    • Handle: RePEc:mae:wpaper:2022-02
    as

    Download full text from publisher

    File URL: https://www.nbrm.mk/content/Households_euroization_in_the_R_N_Macedonia_WP2-2022.pdf
    File Function: First version, 2019
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    References listed on IDEAS

    as
    1. Guido della Valle & Vasilika Kota & Mr. Romain M Veyrune & Ezequiel Cabezon & Shaoyu Guo, 2018. "Euroization Drivers and Effective Policy Response: An Application to the case of Albania," IMF Working Papers 2018/021, International Monetary Fund.
    2. repec:onb:oenbwp:y::i:159:b:1 is not listed on IDEAS
    3. Magdalena Petrovska & Ljupka Georgievska, 2015. "Alternative Indicator of Monetary Policy Stance for Macedonia," Working Papers 2015-01, National Bank of the Republic of North Macedonia.
    4. Thomas Scheiber & Helmut Stix, 2009. "Euroization in Central, Eastern and Southeastern Europe – New Evidence On Its Extent and Some Evidence On Its Causes," Working Papers 159, Oesterreichische Nationalbank (Austrian Central Bank).
    5. Luca GATTINI & Paul HIEBERT, 2010. "Forecasting and Assessing Euro Area House Prices Through the Lens of Key Fundamentals," EcoMod2010 259600061, EcoMod.
    6. Helmut Stix, 2008. "Euroization: What Factors drive its Persistence?," Working Papers 140, Oesterreichische Nationalbank (Austrian Central Bank).
    7. Kuo, Chen-Yin, 2016. "Does the vector error correction model perform better than others in forecasting stock price? An application of residual income valuation theory," Economic Modelling, Elsevier, vol. 52(PB), pages 772-789.
    8. Branimir Jovanovic & Aneta Krstevska & Neda Popovska-Kamnar, 2015. "Can Monetary Policy Affect Economic Activity under Surplus Liquidity? Some Evidence from Macedonia," Working Papers 2015-03, National Bank of the Republic of North Macedonia.
    9. Magdalena Petrovska & Ljupka Georgievska, 2015. "Alternative indicator of monetary policy stance for Macedonia," IFC Bulletins chapters, in: Bank for International Settlements (ed.), Indicators to support monetary and financial stability analysis: data sources and statistical methodologies, volume 39, Bank for International Settlements.
    10. Branimir Jovanovic & Egzona Hani & Ljupka Georgievska, 2017. "Post-crisis credit slowdown in South-East Europe: return to normality?," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 44(4), pages 733-780, November.
    11. Windischbauer, Ulrich, 2016. "Strengthening the role of local currencies in EU candidate and potential candidate countries," Occasional Paper Series 170, European Central Bank.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    euroization; local currency; financial stability; monetary policy; prudential policy; Republic of North Macedonia;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • E47 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Forecasting and Simulation: Models and Applications
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies

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