- Decision
- Maintain
- Rate change
- 0 bps
- Reference interest rate
- 5.75%
The National Bank of Serbia (NBS) kept its key policy rate at 5.75% on 09 July 2026, and left the deposit and lending facility rates unchanged at 4.5% and 7.0%, saying the decision reflected actual and expected inflation and risks from the international environment. Year-on-year inflation stayed within the 3.0±1.5% target tolerance band at 3.5% in May, with higher global oil prices lifting domestic fuel prices, partly offset by government measures, while food prices continued to decline and core inflation remained relatively stable around the upper bound of the headline band. The NBS said its May projection envisages inflation slowing by September, then hovering around the upper bound, with a temporary overshoot possible by end-2026 or early 2027 before returning within the target band by mid-2027 if the recent energy shock proves temporary and oil prices remain around current lower levels. On activity, the central bank said developments since the start of the year were more favourable than expected, with real GDP growth at 3.2% year on year in the first quarter and lending to corporates and households up 16.4% in May, while it continues to maintain relative exchange-rate stability. The Board cited the Middle East conflict, commodity-price volatility and moves by leading central banks as key external risks, and said it will remain cautious and data dependent, adding that it will use all available instruments if higher oil prices generate stronger second-round effects through inflation expectations.
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.