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Abstract

This paper describes developments in the foreign exchange market in the past few years, especially after the outbreak of the global economic crisis and the strong depreciation rate of the dinar. In addition, it discusses the impact of exchange rate on prices in Serbia in terms of the concept of the National Bank of Serbia on inflation targeting, as well as possible constraints to intervention of the National Bank of Serbia at the foreign exchange market. The aim of this paper is to show how many factors from the monetary sphere, and how many factors from the real sphere influence on the depreciation rate of the dinar.

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