INTEREST RATES AND INFLATION AS DETERMINANT FACTORS OF SAVING IN COMMERCIAL BANKS OF NORTH MACEDONIA

This study aims to analyze the effect of the Central Bank of North Macedonia (National Bank), which is in North Macedonia presented by National Central Bank (BI) Rate and inflation rate on the savings rate at commercial banks in North Macedonia by using the analysis tools of autoregressive conditional heteroscedasticity (ARCH) and generalized autoregressive conditional heteroscedasticity (GARCH). The analysis results show that the BI Rate and inflation significantly affect saving rates at commercial banks in North Macedonia. The importance of being a source of investment funds to support development activities can be a consideration for the government to formulate a policy for allocating investment from these savings funds for productive sectors. Practically, it is hoped that the distribution of savings through investment activities can encourage economic growth and increase economic development in North Macedonia.