Serbia Interest Rate2022 Data - 2006-2021 Historical - 2023 Forecast - Calendar

The National Bank of Serbia hiked its main interest rate by 50bps to 2.5% during its June 2022 meeting, the third straight rise in borrowing costs, and in line with market forecasts. Interest rates are now at their highest level since 2019, amid the Ukraine conflict, a further spike in prices of agricultural commodities and industrial raw materials, and ongoing supply chain constraints. The inflation in Serbia continued to rise to hit nine-year highs of 9.6% in April but is expected to slow in the second half of the year. Further interest rate increases will depend on geopolitical developments and both national and international factors weighing on the inflation.

The National Bank of Serbia hiked its main interest rate by 50bps to 2%, the second back to back rise in borrowing costs, and a more aggressive move than analyst forecasts of a 25 bps hike. Deposit rates and credit facilities were lifted to 1% and 3%, respectively. The central bank said inflationary pressures continued to be stronger than expected, and the move aimed to contain 2nd round effects and price expectations. Headline inflation accelerated to 9.6% in April led by soaring food and fuel prices, and well above the central bank’s target ceiling of 4.5%, as the war in Ukraine further strained global supply chains, but policymakers see inflation beginning its moderation path in the 2nd semester and return to target in the 2nd half of 2023. Still, domestic economic growth remained robust, and estimates point to an expansion of 4.3% year-on-year in Q1, and is expected to rise further in Q2, although for the whole year, forecasts could be revised lower.

The National Bank of Serbia hiked its main interest rate by 50bps to 1.5%, the first rise in borrowing costs since 2008, while rates on deposit and credit facilities were lifted to 0.5% and 2.5%, respectively. The move comes as the economy faces rising inflationary pressures due to global supply snags, made worse by the Ukraine crisis. The headline inflation rate jumped to 8.8% in February, the highest since June 2013 and well above the central bank’s target of 1.5%-4.5% due to rising energy and raw material prices. Still, the central bank noted that the current tightening of monetary conditions would not significantly affect economic activity in our country, pointing to higher levels of investment and private consumption.