Serbia Monetary Policy February 2017


Serbia: NBS keeps policy rate unchanged in February

February 14, 2017

At its 14 February monetary policy meeting, the Executive Board of the National Bank of Serbia (NBS) decided to leave the key policy rate unchanged at 4.00%, where it has been since 7 July. The rate stands at its lowest level since the Bank introduced an inflation targeting mandate in 2006.

The NBS explained in its brief press release that it had based its decision on its latest inflation data and ongoing international developments. The Bank expects inflation to remain low and stable and to move within its recently-lowered target range of 3.0% plus/minus 1.5 percentage points by the first months of 2017. Inflationary pressures will increase due to the recovery of domestic demand and higher oil prices. On the other hand, low food production costs will drag on consumer prices. The Bank added that there is heightened uncertainty in the international commodity and financial markets. Diverging monetary policies across leading central banks, too, are expected to increase uncertainty surrounding global capital flows. These risks, however, should be mitigated by resilient economic growth and the narrowing of internal and external imbalances.

The next monetary policy meeting is scheduled for 14 March.

FocusEconomics Consensus Forecast panelists expect the key policy rate to end 2017 at 4.23% on average. The panel sees it rising next year, with an average Consensus of 4.72% by year-end.

Author:, Economist

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Serbia Monetary Policy Chart

Serbia Monetary Policy February 2017 0

Note: NBS Reference Rate in %.
Source: National Bank of Serbia (NBS).

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