- Decision
- Maintain
- Rate change
- 0 bps
- key policy rate
- 5.75%
The Executive Board of the National Bank of Serbia left the key policy rate unchanged at 5.75 percent on 11 September, maintaining deposit and lending facility rates at 4.5 percent and 7.0 percent, respectively, as it judged that current and projected inflation, alongside still-elevated domestic and external uncertainties, warrant continued caution. After cutting the rate by a cumulative 75 bp in 2024, the Bank has kept it steady throughout 2025. The operating framework remains anchored by a stable dinar and unchanged corridor settings. Headline inflation re-accelerated to 4.9 percent y/y in July from 3.8 percent in May, largely on weather-driven food price rises, while core inflation held at 4.7 percent; the Board expects a marked slowdown from September and stable readings within the 3 ± 1.5 pp target band through year-end, easing further in 2026 as global cost pressures fade and a new harvest arrives. GDP grew 2 percent y/y on average in H1, with industrial output up 5.5 percent y/y in July, and the Bank projects full-year growth of 2.75 percent accelerating to 4–5 percent in 2026–27, supported by double-digit credit expansion (11.4 percent y/y in July) and infrastructure spending under “Leap into the Future – Serbia Expo 2027”. Exchange-rate stability continues to underpin price and financial stability. Externally, the Board highlighted lingering risks from uncertain global trade policies and geopolitical tensions, though energy prices have eased following a Middle East ceasefire and Russia-Ukraine talks; markets see ECB easing nearing completion while the Federal Reserve may resume cuts after a pause. Policymakers will retain a meeting-by-meeting, data-driven approach, with the next rate decision set for 9 October.
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.