The convertible mark is the only mark that exists today. The stability of the BiH currency has never been in question, since its establishment in 1998, experts say. However, due to the economic crisis in the world and geostrategic developments, long-term stability could be shaken. While the dollar is getting stronger, the euro is under increasing pressure, which is an additional problem.
”As for the convertible mark, it is stable because our monetary policy allows us to do so. The euro is our anchor currency – as the euro changes, so will the convertible mark,” explains economic expert Goran Mirascic.
The weakening of the euro against the dollar is a cause for concern. However, inflation caused by the war in Ukraine is a much bigger problem, warns Mirascic: “What is more challenging is the challenge of inflation. What is currently happening in the European Union (EU) is that all attention is on the measures to be taken by the European Central Bank.”
While we wait for measures to be taken, inflation is rising. During this time, the stability and value of a large number of currencies are falling. The convertible mark is linked to the euro and depends on its movement in the market. This puts it in the worst position because it depends on others.
”All these currencies are connected, with the fact that we are in an even worse situation because we are tied to a currency. The strengthening of the dollar is the situation that the United States (U.S.) has during the war in Ukraine. The U.S. only profits from this war in Ukraine, and Europe loses. Those 8-10% of inflation, as predicted, by that much will have a lower value of BAM at the end of the year,” states Berislav Kutle, director of the Association of BiH Banks.
High inflation is the biggest threat to the convertible mark and its value. The currency is stable, but there is still room for concern. There are several reasons.
”In the first place, there is inflation, geostrategic events through Russia’s aggression against Ukraine. The entire chain of all products is questionable and of course, this affects the rise in prices,” said Hazim Rancic, Deputy Minister of Finance and Treasury of BiH.
Inflation threatens to cause problems in the financial market in the long run. The influence of world economic powers on the financial sector of BiH is unquestionable. Each convertible mark banknote has a euro cover. Financial stability with the constant growth of deposits is the goal of every developed country. BiH cannot currently boast of these qualities, Federalna writes.
E.Dz.