Croatia had a hard start, followed by a move towards heavy exchange rate management in a context of limited development of financial markets and institutions.

Years Targets and attainment Classification
1992-93 new central bank and currency late 1991, attempt at money-based stabilisation derailed by lack of instruments and wider context of transition plus conflict, exchange rate depreciating fast, very high inflation unstructured discretion UD
1994-2017 new (and successful) stabilisation package late 1993; currency reform May 1994; monetary policy strategy initially based on announced base money targets (overshot), but soon becomes exchange rate-based and this focus continues throughout, in context of high (c.70%) loan and deposit euroization, particularly in later years: exchange rate is relatively stable with ‘quasi-peg’ to euro but wider fluctuations allowed than normal under a peg; monetary instruments limited: mainly forex purchases to affect liquidity and reserve requirements, also some sales of central bank bills (for liquidity management rather than interest rate setting) and occasional (not always effective) use of credit controls; latterly talk of euro adoption loosely structured discretion LSD

Selected IMF references: RED 1995 pp21-7; SISA 1999 pp46-8, 50; SISA 2002 chapter II; SISA 2004 chapter I; SR 2004 pp19-20; SR 2007 pp14-15; SR 2009 p12; SR 2010 pp7-9, 13-14; SR 2012, pp8-9; SR 2014 pp12, 13, 15; SR 2015 p13; SR 2016 pp11-12; SR 2017 pp14-16.

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