This was due to exchange rate losses on the foreign currency holdings. These had increased substantially in the course of our foreign exchange market interventions, which we carried out in order to counter the deflationary threat identified by us. The loss and the increased risk in our central bank balance sheet is a matter which we take very seriously. The annual loss has provoked critical remarks, in particular as regards our independence and our ostensibly far-reaching powers. It is understandable that people will question the extensive measures we had to take to manage the financial crisis. That is all part of life in a democratic society. I am therefore grateful for this opportunity to present to you, in the next few minutes, my thoughts on the essence, the boundaries and the pitfalls of our independence. I hope I will be able to clarify one or two misunderstandings in the process. The reason why the SNB is independent is not because it happens to suit the members of the Governing Board, which is the body responsible for monetary policy. I can assure you that it would sometimes be easier if we could just accept instructions from a higher body. What actually happens is that we have to bear responsibility ourselves for the monetary policy decisions we take, and we take them – typically – under a veil of uncertainty. The reason why we are independent is so that we can better fulfil our mandate. In other words, our independence is purely a means to a higher end.
Ljube Trpeski: Goals and objectives of the monetary policy for the year 2001 Address by Ljube Trpeski, Governor of the National Bank of the Republic of Macedonia to the Parliament of the Republic of Macedonia on 6 February 2001. *  *  *  Honorable, According to Article 3 of the National Bank of the Republic of Macedonia Act, the Central Bank is responsible for the stability of the domestic currency, the monetary policy and the overall domestic and international payments liquidity in the Republic of Macedonia. Furthermore, the National Bank, within its rights and duties, is responsible for providing and preserving sound banking system of the Republic of Macedonia. Given such defined legal duties and taking into account achievements in this area, it may be concluded that in 2000 the National Bank of the Republic of Macedonia, acting in compliance with the given rights, accomplished its legal duties. Stability of the domestic currency The stability of the domestic currency may be observed from two aspects: •  Stability of the internal value of the Denar. It is expressed through its purchasing power, i.e. the price stability in the Republic of Macedonia; and  •  Stability of the external value of the Denar. It is expressed through the stability of the exchange rate of the Denar, i.e. its preservation at adequate level against other currencies. The preservation of the price stability is the primary objective of the monetary policy of the National Bank of the Republic of Macedonia.