- Decision
- Maintain
- Rate change
- 0 bps
- key policy rate
- 5.75%
The Executive Board of the National Bank of Serbia (NBS) left the key policy rate unchanged at 5.75 percent on 10 July 2025, maintaining deposit and lending facility rates at 4.5 percent and 7.0 percent respectively, as it judged continued caution necessary amid volatile global commodity markets, weather-related food supply pressures and heightened geopolitical and trade uncertainties that could lift inflation toward the top of the 3 ± 1.5 percentage-point target band. After three 25 bp cuts in 2024, the rate has remained at 5.75 percent since September. The unchanged corridor was reaffirmed, with no adjustments to liquidity facilities. Headline inflation slowed to 3.8 percent year on year in May and core to 4.6 percent, though rising oil and food prices are expected to cause a temporary uptick; industrial production grew 2.5 percent y/y in January–May, exports expanded 10.2 percent, and credit to corporates and households rose more than 11 percent, supporting the Board’s view that growth will strengthen on the back of higher car output and Expo 2027 infrastructure projects. The Board noted that the European Central Bank’s continued accommodative stance should support cheaper euro-indexed lending in Serbia, while a more cautious U.S. Federal Reserve could influence capital flows to emerging markets. It also highlighted risks from the intensifying Middle East conflict and record cocoa and coffee prices, which are fuelling global market volatility. The NBS will keep setting policy on a meeting-by-meeting basis, monitoring inflation, growth and financial stability, with the next rate-setting meeting scheduled for 7 August 2025.
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.