NBS presents monetary policy for 2013 - Target inflation at 4 percent

The basic goal of the National Bank of Serbia (NBS) monetary policy is to achieve the target inflation in the mid-term, according to the policy for 2013.

This should "help maintain the stability of the financial system and sustainable economic growth," B92 reports.

The goal for 2013 is expressed as an annual percentage change in the consumer price index, with the target inflation at four plus or minus 1.5 percent - above the target inflation in developed countries (two plus or minus 2.5).

The goal is based on an assessment that the structural reforms and price liberalization would not be completed in the given period.

The NBS said it would continue with its managed floating exchange rate.

The bank will intervene on the foreign exchange market to prevent big changes in the exchange rate and increase turnover, ensuring free operation of the market and stability of the financial system and prices.

If the global crisis keeps spilling over to the Serbian economy, the NBS will take steps independently and with the government to keep the financial system stable.

If the inflation goes outside of the target rate for more than 6 consecutive months, the NBS will inform the government about the causes, necessary steps and time needed to fix the situation.