First author: MARKOVIĆ Milan (
Affiliation: University of Niš, Innovation Center, Republic of Serbia
Second author: MARJANOVIĆ Ivana (
Affiliation: University of Niš, Innovation Center, Republic of Serbia


The aim of this paper is to assess the external liquidity and currency stability of the Serbian economy. For this purpose, the following indicators were used: coverage of short-term external debt by foreign exchange reserves, coverage of imports by foreign exchange reserves and the exchange market pressure (EMP) index of the Republic of Serbia. Global events such as the coronavirus pandemic and the crisis in Ukraine have also affected the national financial market, so it is important to investigate this impact and compare it with the previous crisis of 2008-2009. The research shows that the Republic of Serbia has an optimal level of foreign exchange reserves in order to preserve the stability of the exchange rate and finance the balance of payments deficit, as well as a relatively low degree of vulnerability to the currency crisis. Based on that, it can be assessed that the monetary policy was conducted adequately in the previous period of the health crisis. However, some caution is needed due to the growing value of the EMP index as a result of increased demand for foreign exchange due to market panic, global uncertainty and the current geopolitical situation.

Keywords: foreign exchange reserves, exchange rate, exchange market pressure (EMP) index, currency crises, currency sustainability, financial stability

Pages: 17 - 21
Volume: 14
Issue: 2
Publication date: December, 2022

MARKOVIĆ Milan & MARJANOVIĆ Ivana, 2022. "VULNERABILITY TO THE CURRENCY CRISIS: THE CASE OF SERBIA", Management of Sustainable Development, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 14(2), pages 17-21, December. DOI: