National Bank of Serbia

December 10, 2015

In seven of the eight monthly meetings between March and October this year, the Executive Board voted to cut Serbia’s central bank interest rate by 50 basis points.  There were no policy changes at the meetings in January, February, July, November or, most recently, December.  The rate is now 3.50% versus 8.0% at the beginning of this year.  “At 1.4% in October, year-on-year inflation is below the NBS target tolerance band, with inflation expectations of the financial and corporate sectors also trending below the 4.0% inflation target for one and two years ahead. Inflation is expected to return within the target tolerance band in the second half of 2016,” according to today’s released statement.  The statement explicitly worries about how commodity prices and financial markets will react to the coming increases in the federal funds rate.

Copyright 2015, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.



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