The National Bank of Serbia published its August Inflation Report, raising its 2026 GDP growth forecast to 3.2% from 3.0% after stronger-than-expected first-half activity, while maintaining its 2027 forecast at 4.5%. It expects year-over-year inflation to remain within the 3% plus or minus 1.5 percentage point target band over the next two years. Average inflation in 2026 is projected at 3.2%, down from 3.6% in the May forecast, although inflation is expected to rise slightly above 4% from September and remain around that level during 2027 before easing. Inflation slowed to 1.9% in July, mainly because of lower food prices following a strong fruit and vegetable harvest, while core inflation was 4.5%. GDP growth accelerated to 3.6% in the second quarter, supported by services, manufacturing, construction and agriculture. The central bank kept its key policy rate at 5.75% and will continue making decisions meeting by meeting, citing upside risks to inflation and downside risks to growth from geopolitical tensions, energy prices and supply disruptions. It also lowered its projected 2026 current account deficit to 4.1% of GDP.
2026-08-19National Bank of Serbia
National Bank of Serbia raises 2026 GDP growth forecast to 3.2%, projects inflation within target band
The National Bank of Serbia raised its 2026 GDP growth forecast to 3.2% and lowered its average inflation forecast to 3.2%. Inflation is expected to remain within the target band over the next two years, while the key policy rate remains at 5.75% amid geopolitical and energy-price risks.