National Bank of Serbia raises benchmark interest rate – Loan installments to go up

Serbia’s central bank decided to increase its benchmark interest rate by 25 basis points to 5.75% to counter inflationary pressures, it said on Thursday.

The central bank raised the lending facility rate by 50 basis points, to 7%, while the deposit facility has been maintained at 4.5%, it said in a statement.

Inflationary pressures on the global and domestic markets led to be stronger and more persistent than previously expected, the National Bank of Serbia (NBS) noted, adding that the trend requires further tightening of monetary policy.

“In its decision-making, the NBS Board was guided by the persistently high global cost-push pressures and imported inflation, despite the signs of easing, as well as the necessity to contain their second-round effects on price growth at home through inflation expectations and to impact a part of demand-side pressures. The NBS thus helps inflation to strike a downward path and retreat within the target tolerance band until the end of the projection horizon. The transmission of the rate increases so far to the rates in the markets of money, loans and savings signals the effectiveness of the monetary policy transmission mechanism via the interest rate channel. Moreover, by maintaining the relative stability of the dinar against the euro, the NBS also significantly contributes to containing the spillover effect of rising import prices on domestic prices, and to overall macroeconomic stability amid elevated global uncertainty,“ the NBS said in a press release.

The latest data published by the national statistical office showed that Serbia’s consumer prices increased by 15.8% year-on-year in January, after rising by 15.1% the month before.

The central bank will hold its next rate-setting meeting on April 6.

(, 09.03.2023)

This post is also available in: Italiano

Share this post

Leave a Reply

Your email address will not be published. Required fields are marked *

scroll to top