The dinar is at its lowest level since the beginning of the year, and the demand for euros has increased in exchange offices. The NBS justifies the increased demand for foreign exchange with seasonal changes, and interprets the lack of euros on the market as a reduced inflow of foreign investments.
In the last ten days, citizens have been buying more euros in Belgrade than before exchange offices, and the reason for this can also be turbulence political events in Serbia, writes Aleksandra Nenadović for The new economy.
Prime Minister was confirmed on Wednesday (March 19). resignation, after a series of incidents that followed protests and blockades, and several people were arrested in connection with the case canopy in Novi Sad.
The National Bank of Serbia (NBS) justifies the increased demand for foreign exchange with seasonal changes, and interprets the lack of euros on the market as a reduced inflow of foreign investments.
What is the situation in the exchange offices?
In most of the exchange offices that New Economy journalists visited, they say that the demand has more than increased in recent days, but that the supply of foreign currency is stable.
NBS operates on the foreign exchange market and regulates the exchange rate by buying or selling currencies, in order to maintain the exchange rate at a level that is stable.
Despite this, the dinar is the weakest since the beginning of this year and currently the average exchange rate is at 117,222 against the euro, while the previous day it was slightly weaker, at 117,224 against the euro.
In the first days of this year, the dinar was traded at 117,115 in exchange offices, and it reached its highest value in February - when at one point the average exchange rate was at 117,048 against the euro.
In the last two months, the NBS has reduced the foreign exchange reserves that defend the dinar against the euro.
From the beginning of 2025 to the end of February, NBS net sold 745 million euros, while in January it was a net seller of 420 million euros, while in February this sale was reduced to 325 million euros.
"The main cause of the increased demand for foreign currency on the domestic foreign exchange market, both in January and February, was the seasonally increased demand for foreign currency by residents, primarily companies from the energy sector, for the purpose of purchasing energy in the winter period. At the same time, compared to the beginning of last year, the supply of foreign currency based on FDI is lower. Due to such developments, in order to preserve the relative stability of the exchange rate of the dinar against the euro, the NBS provided the missing amount of foreign currency on the domestic foreign exchange market by using foreign exchange reserves, which were strongly accumulated in previous years and whose purpose, among other things, is to be used in such situations", answered the NBS newspaper Danas.
Last year, the NBS bought 2,7 billion euros net in order to maintain the relative stability of the dinar exchange rate against the euro.
Serbia's foreign exchange reserves reached record levels in 2024, and at the end of December they were at 29,29 billion euros. Gross foreign exchange reserves of the NBS at the end of February 2025 were at the level of 28,8 billion euros.
The balance of payments, which contains data related to the inflow of FDI in January this year, should be published on Thursday (March 20).
The political leadership of Serbia claims that the student and civil protests had the effect of reducing the inflow of FDI. But the statements coming from the leading politicians can also partially contribute to the fact that citizens buy more foreign currencies than before.
Source: New Economy
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