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Inflation Targeting in Serbia

Author

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  • Jelena Fabris

    (Development Fund of the Republic of Serbia)

Abstract

Serbia introduced inflation targeting regime in August 2006. After nine years of its application, conclusions may be drawn on the (un)successfulness of the regime. Inflation targets have not been achieved during seven of nine observed years. Key difficulties in the application of the regime refer to insufficient efficiency of monetary policy instruments, insufficient confidence in the domestic currency (widely spread informal euroisation), and indexing of prices according to the exchange rate. The paper consists of four sections. The first section analyses theoretical assumptions of the inflation targeting regime. The second part describes the characteristics of the regime in Serbia. The third section analyses results, while the fourth section analyses the reasons for insufficient efficiency of the regime and gives actual suggestions for improving the existing regime.

Suggested Citation

  • Jelena Fabris, 2015. "Inflation Targeting in Serbia," Journal of Central Banking Theory and Practice, Central bank of Montenegro, vol. 4(2), pages 59-74.
    • Handle: RePEc:cbk:journl:v:4:y:2015:i:2:p:59-74
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    References listed on IDEAS

    as
    1. Sebastian Edwards, 2006. "The Relationship Between Exchange Rates and Inflation Targeting Revisited," NBER Working Papers 12163, National Bureau of Economic Research, Inc.
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    3. Edward M. Gramlich, 2005. "The politics of inflation targeting: a speech at the Euromoney Inflation Conference, Paris, France, May 26, 2005," Speech 117, Board of Governors of the Federal Reserve System (U.S.).
    4. Carare, Alina & Stone, Mark R., 2006. "Inflation targeting regimes," European Economic Review, Elsevier, vol. 50(5), pages 1297-1315, July.
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    6. Kosta Josifidis & Jean-Pierre Allegret & Emilija Beker Pucar, 2009. "Monetary and Exchange Rate Regimes Changes: The Cases of Poland, Czech Republic, Slovakia and Republic of Serbia," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 56(2), pages 199-226, June.
    7. Frederic S. Mishkin, 2006. "Monetary Policy Strategy: How Did We Get Here?," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 53(4), pages 359-388, December.
    Full references (including those not matched with items on IDEAS)

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    Keywords

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    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System

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