Photograph: HINA/ Damir SENČAR /ds

The Croatian economy has continued to recover this year, the Croatian National Bank (HNB) said in a statement from an HNB Council meeting on Wednesday.

The HNB Council met to discuss the latest monetary and economic indicators and a report on the situation in the banking system in the last quarter of 2015. It adopted a monetary policy projection for 2016-2019 and several other decisions.

Monthly indicators show that at the start of 2016 real GDP increased again, after a temporary decrease at the end of last year. January and February saw a pick-up in the annual fall of consumer prices, mostly as a result of trends in energy and food prices, the central bank said. 

At the start of 2016 the monetary policy maintained its expansionary nature with the highest recorded levels of surplus liquidity, while bank lending stagnated at end-2015 levels. The process of conversion and partial write-off of CHF-indexed household loans resulted in a nominal decrease of lending.

Data on government financing indicate that strong fiscal adjustment was carried out last year, and favourable fiscal trends have continued this year, the central bank said.

The HNB Council adopted decisions aligning the operating rules of the Croatian national component of the TARGET 2 payment system with the European Central Bank's TARGET 2 guidelines.

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