2022 was marked by economic hardships that affected the whole world, including Serbia. Due to the war in Ukraine, there was a sudden jump in the prices of food and energy, which, like a domino effect, caused growing inflation in all European countries, followed by an increase in interest rates.
In an interview with Euronews Serbia, Professor of the Faculty of Economics, Danica Popović, says that the latest data from the Serbian Statistical Office, which states that the year-on-year inflation is 15 percent, is actually not a realistic indicator because the state has capped certain prices.
“Inflation is not 15 percent and we know that because they (the Serbian government) have capped some prices. If the prices were realistic, we would see that the inflation stands at over 20 percent or even more. The question here is who bears that cost when the prices are capped”, says Professor Popović.
“Import inflation has significantly contributed to higher overall inflation. The global price of crude oil has been going up terribly for a while. Furthermore, the prices of food in all countries have also been going up. Then you also need to consider inflation based on the real costs. I don’t know how successful the Serbian National Bank was in curbing inflation when all of the aforementioned factors depend very little on it”, adds Professor Popović.
She also states that adjusting the benchmark interest rate is the only civilized way to reduce inflation.
This post is also available in: Italiano