In the current period in the Republic of Croatia, the current topic is the introduction of the euro and the implementation of exchange rate policy regarding the introduction of the euro as the new official currency in Croatia. The movement of the exchange rate and the manner in which the central bank implements its exchange rate and monetary policy are very important. In the case of Croatia, it is the Croatian National Bank that deals with exchange rate movements, the foreign exchange market and exchange rate policy. The paper describes the concept of exchange rate, the concept of foreign exchange market, the concept, instruments and objectives of exchange rate policy in the context of the introduction of the euro and also describes the strategy, advantages and disadvantages of introducing the euro as the official currency in Croatia. The exchange rate policy and the movement of the exchange rate in the Republic of Croatia are analyzed, as well as the assessment of the equilibrium exchange rate, ie the central parity that is important to determine correctly when converting currencies, in order to avoid certain difficulties. This parity is determined by various models, one of which will be selected and described in the course of work.