Key Policy Rate as the Main or Additional Instrument of Inflation Targeting Strategy in Serbia

Furtula Srđan () and Kostić Milan ()
Additional contact information
Furtula Srđan: University of Kragujevac, Faculty of Economics, Kragujevac, Republic of Serbia
Kostić Milan: University of Kragujevac, Faculty of Economics, Kragujevac, Republic of Serbia

Economic Themes, 2017, vol. 55, issue 2, 143-159

Abstract: In achieving price stability as the primary objective of monetary policy, the National Bank of Serbia uses the key policy rate as the main instrument of monetary policy, while other instruments have a supporting role - contribute to a smooth transmission of the key policy rate on the market, as well as the development of financial markets. However, because the conditions in which economic and financial system of the Republic of Serbia works, transmission mechanism of monetary policy is conducted mainly through the exchange rate channel, while the channel of interest rates almost did not work. The great impact the exchange rate channel is determined by the great influence of the single currency euro and the ECB on our country. Therefore, the aim of this paper is to analyse the efficiency of the key policy rate as a monetary policy instrument, because in recent years the primary instrument receives a secondary character in the monetary regulation.

Keywords: National Bank of Serbia; inflation; monetary policy; key policy rate; foreign exchange market (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1515/ethemes-2017-0009 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:ecothe:v:55:y:2017:i:2:p:143-159:n:1

DOI: 10.1515/ethemes-2017-0009

Access Statistics for this article

Economic Themes is currently edited by Marija Radosavljević

More articles in Economic Themes from Sciendo
Bibliographic data for series maintained by Peter Golla ().