This paper aims to assess the usefulness of leading indicators in business cycle research and forecast. Initially we test the predictive power of the ESI within a static probit model as a leading indicator, commonly perceived to be able to provide a reliable summary of the current economic...

The primary goal of this paper is to describe several models that are currently used at the National Bank of the Republic of Macedonia (NBRM) for short-term forecasting of inflation - Autoregressive integrated moving average models (aggregated and disaggregated approach), three equation...

This paper elaborates the economic impacts of the foreign direct investments (FDI) on the case of Macedonian economy. Most developing countries consider FDI a vital source for their development. Anyway, it is quite difficult to measure the economic effects of FDI over the host country, having in...

Minimum wage is an important redistributive tool and an important element of the employment strategies and social policies for overcoming poverty and reducing inequality. Even though the social dimension of the minimum wage concept is unquestionable, it also provokes frequent debates and...

This paper presents the main findings of a survey on wage and price formation of firms in Macedonia conducted in the first half of 2014. The main objective was to identify some relevant characteristics about the dynamics of wages and prices in Macedonia, clarifying the relationship between them,...

National Bank of the Republic of Macedonia (NBRM) has been implementing an exchange rate targeting strategy for a more then a decade and so far it proved to be very successful. The aim of this paper is shortly to explain the advantages of this strategy and moreover to put more focus on the...

Surplus liquidity in the banking system changes the monetary transmission mechanism, reducing the effectiveness of the traditional instrument, the interest rate. In this paper we examine the real effects of several monetary-policy instruments in Macedonia, an economy characterized by surplus...

Aggregate demand forecasting, also known as nowcasting when it applies to current quarter assessment, is of notable interest to policy makers. This paper concentrates on the empirical methods dealing with mixed-frequency data. In particular, it focuses on the MIDAS approach and its later...

This paper has adopted a Bayesian FAVAR approach to examine the monetary transmission mechanism in North Macedonia. The model is based on a broad data set that encompasses 140 monthly time series spanning between January 2010 and January 2019. In particular, the impact of policy on bank...