Montenegrin Central Bank Downplays Impact of ECB Rate Hikes

The Central Bank of Montenegro (CBCG) has stated that it does not expect the recent increase in key interest rates by the European Central Bank (ECB) to have a significant impact on domestic interest rates. However, it acknowledges that effects may be transmitted gradually, depending on various domestic and external factors.

The CBCG noted that interest rates in Montenegro have been declining for over two years. The latest ECB decision could potentially slow down this trend, but the bank does not anticipate a sudden change in domestic interest rates.

According to the statement published by the CBCG, the dominant share of loans in Montenegro is contracted with a fixed interest rate. Only 6.12% of total loans have variable interest rates, which are directly exposed to changes in ECB market reference interest rates.