- Decision
- Maintain
- Rate change
- 0 bps
- Reference interest rate
- 5.75%
The Executive Board of the National Bank of Serbia left the key policy rate unchanged at 5.75 % and maintained deposit and lending facility rates at 4.5 % and 7.0 %, judging that current and projected inflation remain consistent with target while heightened geopolitical risks, notably the recent spike in global oil prices following the Middle East conflict, cloud the outlook. The rate has been steady at 5.75 % since the last 25 bp cut in September 2024. The central bank reiterated its cautious stance and commitment to preserving exchange-rate stability, adding it will act with “all available instruments” if higher energy costs start feeding into expectations. Year-on-year CPI ran at 2.5 % in February, below the 3 ± 1.5 % target midpoint, but is seen drifting to around 4 % from September due to last year’s low base; credit growth accelerated to 16.4 % y/y in February and services-led activity picked up after refinery disruptions eased. Externally, Serbia’s net-energy-import position makes domestic fuel prices sensitive to global oil moves, though the government has capped margins, cut excise duties and banned petroleum exports to damp secondary effects. Internationally, rising protectionism and uncertainty about the next steps by the Federal Reserve and European Central Bank add to volatility in commodity and financial markets. The Board will continue to decide meeting-by-meeting, is updating its forecasts under alternative scenarios, and signalled readiness to tighten if second-round pressures threaten medium-term price stability.
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.