- Decision
- Maintain
- Rate change
- 0 bps
- key policy rate
- 5.75%
The National Bank of Serbia (NBS) Executive Board kept the key policy rate at 5.75 %, with deposit and lending facility rates unchanged at 4.5 % and 7.0 %, citing the need for caution amid persistent global geopolitical tensions, uncertain energy and food commodity prices, and core inflation still slightly above 5 % even as headline inflation has stayed within the 3 ± 1.5 % target band since May and eased to an estimated 4.3 % y/y in November; this pause follows a cumulative 75 bp of rate cuts since June 2024 whose effects are still unfolding. The unchanged corridor preserves current liquidity conditions. Disinflation has been aided by lower energy and food costs, moderating imported price pressures and still-tight monetary settings, while the economy grew 3.9 % in 2024 on gains in industry, construction and services, alongside 9.2 % real wage growth and 8 % y/y credit expansion in November. A record foreign direct investment inflow of more than EUR 5 bn and a lower country risk premium after Serbia’s upgrade to investment grade strengthen external resilience, though subdued demand in key trading partners and possible rebounds in global oil, gas and agricultural prices remain downside risks. The Board will decide policy on a meeting-to-meeting basis, with fresh inflation and growth projections to be assessed at the 13 February rate-setting session.
Rate evolution
From June 2025 through September 2026, the National Bank of Serbia kept the key policy rate unchanged at 5.75%, extending a pause with no net change. The hold reflected actual and expected inflation and uncertainty, which eased in early autumn before worsening again, with mid-2025 decisions balancing weather- and drought-driven food inflation and an oil-price rise from Middle East tensions against softer domestic activity, while later decisions judged that the Government’s margin-capping decree, lower imported cost pressures, exchange-rate stability and earlier easing would contain inflation as lending and Serbia Expo 2027-related investment supported growth.
On 10 September 2026, the Executive Board again held the rate at 5.75%, citing actual and expected inflation and risks from the international environment. Year-on-year inflation remained within the 3±1.5% target band and stood at 1.9% in July, mainly because an exceptionally good harvest lowered fruit and vegetable prices, while significant second-round effects had not materialised and the economy proved more resilient than expected to the energy shock. The August projection envisaged inflation remaining within the target band over the next two years, moving around 4% from September 2026 and during 2027 before gradually declining, while core inflation stood at 4.5% in July.
Economic activity also exceeded expectations, with real gross domestic product growth accelerating to 3.8% year on year in the second quarter and prompting the National Bank of Serbia to raise its 2026 growth projection to 3.2%, while the Executive Board maintained a cautious stance as uncertainty over the Middle East conflict and oil prices remained elevated and reiterated that it would use all available instruments if stronger second-round effects lifted other prices through inflation expectations.