Mild increase in dinarization rate in Serbia

The level of dinarization measured by the share of Dinar transactions in the overall investments of the economy and population has grown mildly over the past four years, people at the National Bank of Serbia told Tanjug news agency.
The NBS specified that the dinarization rate has gone up from 24.5 to 26.4 percent in the period between early 2010 and February 2014.

- We expect a more noticeable increase in the dinarization rate in the medium term. Further stability of macroeconomic environment, low and stable inflation and sustainable economic growth in particular, should contribute to this - said people at the NBS.

When asked if they expected inflation to be within the target range in the years to come, people at the NBS reminded that according to the latest data for March 2014, year-on-year inflation measured by the consumer price index had been at 2.3%, that is, below the lower limit of the allowed deviation from the target.

- We expect inflation to fluctuate within the limits of allowed deviation from target value (4%+/-1.5%) in the following period - people at the central bank said and added that they would continue to pursue a cautious monetary policy as well as to encourage the greater use of Dinar in the financial system through its measures.

According to the central bank, dinarization is a long-term strategic commitment because, as they said, the bigger use of Dinar in the domestic economy also means a more efficient monetary policy and less risk to the country's financial stability due to smaller exposure of the economy to changes in the foreign currency exchange rate.

Narodna banka Srbije Beograd

Vlada Republike Srbije

dinarization

dinar loans

loans in dinars

NBS

inflation

year on year inflation