Rate Hike in Euroland But Central Bank Rates Left Unchanged in Serbia and Turkey
September 10, 2026
Central bank rate announcements today by the European Central Bank, National Bank of Serbia and Central Bank of Turkey each link policy closely to uncertainty created by the conflict between the United States and Iran.
The ECB’s trio of policy interest rates was raised by 25 basis points as markets were widely expecting. The all-important deposit rate will be 2.5%, highest since April 2025. ECB staff revised upward forecasts of average CPI inflation in 2027 and 2028. Excluding food and energy, they now predict 2.6% in 2027 (above the 2026 level) and 2.3% in 2027 (still above target). Today’s statement asserts, “The outlook remains highly uncertain, with risks to the upside for inflation and to the downside for economic growth.”
The National Bank of Serbia’s policy rate of 5.75% since a 25-basis point cut in September 2024 was again left unchanged. “Though the effects of conflict flare-up in the Middle East and rising oil prices on global inflation and economic activity have so far been less intense than initially expected, uncertainty regarding future developments is still elevated, particularly since global oil prices remain higher compared to their pre-conflict levels. One cannot rule out the possibility of а spillover of effects onto production and transportation costs at the global level, as well as on supply chains, capital flows, and consequently inflation.”
With consumer price inflation of 31.5% last month, Turkey is in a different class from either Euroland or Serbia whose latest readings were 3.3% and 1.9%. The Central Bank of Turkey’s policy interest rate had been as high as 50% in 2024 and has been 37% since a percentage point cut from 38% last January. A released statement argues that “elevated energy prices amid geopolitical developments pose an upward risk to the inflation outlook. The impact of geopolitical developments on the inflation outlook through the cost channel, economic activity and expectations is closely monitored.” Officials assert that the 37% interest rate level represents a restrictive monetary stance.
Tags: Central Bank of Turkey, European Central Bank, National Bank of Serbia
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