The article contains a review of the main theoretical currents of thinking concerning the reasons for changes in relative prices and the movements of the real currency exchange rate in transition countries undergoing the catching-up process. It presents in detail the most important hypotheses on the subject - in the first place those, which seek the determinant factors of real currency exchange rates on the supply side of the economy. Then, the work addresses the theories that emphasize the demand effect mechanisms. Finally, it takes up the problem of monetary authorities' reputation in the context of inflationary processes. The article draws attention to a significant variety of potential sources and economic consequences of currency appreciation in countries undergoing the catching-up process, which is particularly important in the context of an adequate determination of exchange rate policy in its practical dimension.