"Exchange rate market will hold stable"

Governor of the National Bank of Serbia (NBS) Dejan Soskic says Serbia should see its home currency stable in the coming period. He added that he saw no reason for any fluctuations in the foreign exchange market. "Exchange rate market will hold stable" “I see no reason why we should witness any major volatility in the foreign exchange market, and I believe that a period of stabilization lies ahead of us,” Soskic told Tanjug. He noted, however, that international factors and circumstances thereof cannot be taken out of consideration “since, as you know, a drop of confidence in the euro or in the region would be reflected on all the countries in the neighborhood, including Serbia.” “I believe that the monetary policy, which at present is largely restrictive, must yield results. In other words, all those who have incorporated some unrealistically high exchange rates or inflation expectations into their prices should reconsider their decisions and cut the prices accordingly,” the governor underlined. “I believe that wise businessmen have already noticed that no risk of such instability as has been incorporated in the prices is looming over us and that they are dropping their prices on time in order to take advantage of the situation and expand their presence in the market,” Soskic added. According to him, it should not be put out of sight that Serbia has a relatively orderly situation in macroeconomic terms, that the total public debt has not gone out of control and that a relatively high level of budgetary discipline and a relatively low ratio of budget deficit to gross domestic product (GDP) has been maintained with the assistance of the International Monetary Fund. “So, comparatively, Serbia is improving relative to other countries in the region. At least international investors see it that way. All this creates, among other things, a mood to invest in Serbia,” said Soskic. Regarding the future sale of Telekom Srbija, the NBS governor said that the money from the sale would stabilize the economic situation in Serbia for a time, but that it could not possibly be a long-term solution to imbalances. Dejan Soskic (Beta, file)

"Exchange rate market will hold stable"

“I see no reason why we should witness any major volatility in the foreign exchange market, and I believe that a period of stabilization lies ahead of us,” Šoškić told Tanjug.

He noted, however, that international factors and circumstances thereof cannot be taken out of consideration “since, as you know, a drop of confidence in the euro or in the region would be reflected on all the countries in the neighborhood, including Serbia.”

“I believe that the monetary policy, which at present is largely restrictive, must yield results. In other words, all those who have incorporated some unrealistically high exchange rates or inflation expectations into their prices should reconsider their decisions and cut the prices accordingly,” the governor underlined.

“I believe that wise businessmen have already noticed that no risk of such instability as has been incorporated in the prices is looming over us and that they are dropping their prices on time in order to take advantage of the situation and expand their presence in the market,” Šoškić added.

According to him, it should not be put out of sight that Serbia has a relatively orderly situation in macroeconomic terms, that the total public debt has not gone out of control and that a relatively high level of budgetary discipline and a relatively low ratio of budget deficit to gross domestic product (GDP) has been maintained with the assistance of the International Monetary Fund.

“So, comparatively, Serbia is improving relative to other countries in the region. At least international investors see it that way. All this creates, among other things, a mood to invest in Serbia,” said Šoškić.

Regarding the future sale of Telekom Srbija, the NBS governor said that the money from the sale would stabilize the economic situation in Serbia for a time, but that it could not possibly be a long-term solution to imbalances.