Serbian Interest Rate Cut

December 10, 2020

The Executive Board of the National Bank of Serbia cut its interest rate by 25 basis points to 1.0% in a move that had not been anticipated by analysts. This brings the total reduction this year to 125 bps following cuts of 50 basis points last March and 25 bps cuts in April and June. A released statement notes the worsening Covid situation especially in Europe and an outlook of low and stable inflation. Today’s rate cut also complements recent fiscal support and is intended to preserve favorable financing conditions for borrowers. Central Bank officials in Serbia also knew the ECB was likely to augment unconventional stimulus later today, and indeed that was the case.

Copyright 2020, Larry Greenberg. All rights reserved. No secondary distribution without express permission.



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