Effective Exchange Rate (REER)
The purpose of the effective exchange rates is to provide important and comparable measures for price and cost competitiveness between countries. Еffective exchange rates are based on weighted geometric averages of bilateral exchange rates of the currency of one country against the currencies of a selection of trading partners. With correction for the relative movements of the national price or cost indicators (domestic economy and foreign economies - trading partners) the real effective exchange rate is calculated. The NBRNM calculates REER based on the following price indicators (deflators): consumer price indices, producer price indices and unit labour cost indices.
The increase in the index of the real effective exchange rate of the Denar is interpreted as an appreciation of the domestic currency and reduced price competitiveness, while the decrease of the index indicate depreciation and a corresponding increase in the competitiveness.
As of 10 March 2026, the National Bank begins publishing data on the Real Effective Exchange Rate (REER), based on a new, updated methodology. As part of this methodological improvement, a revision of the trading partner countries has been made, with the weighting structure reflectingthe most recent foreign trade structure of the domestic economy. In selecting partner countries i.e. the appropriate currencies and weights, the data availability has also been taken into consideration, in terms of their harmonization, frequency and quality. More detailed information on the methodological changes made to the calculation of the indices is available in the Methodological Notes, provided below.
Latest developments:
In February 2026, compared to the same month of last year, the real effective exchange rate deflated by consumer prices and producer prices appreciated by 1.3% and 6.2%, respectively, amid a decrease in the relative consumer prices by 1% and increase in the relative producer prices by 3.8%. The NEER registered an annual appreciation of 2.3%, mostly as a result of the appreciation of the Denar against the Turkish Lira, US Dollar and Chinese yuan.
Archive on Effective Exchange Rate (REER)
For more detailed information on the released statistical data, please contact us at [email protected] or+389 2 3215 181 ext.103 (or 110/108)