National Bank of Serbia Holds Interest Rate Unchanged at 5.75%

The National Bank of Serbia kept its benchmark interest rate at 5.75% in its September meeting, citing current and expected inflation, as well as domestic and international economic conditions. Headline inflation accelerated to 4.9% in July, driven mainly by food and non-alcoholic beverage prices, while core inflation remained at 4.7%. The NBS expects inflation to ease in September under temporary government trade regulations and remain within the target range through year-end, with further gradual easing in 2026. Economic activity remained steady, with GDP growth averaging 2% in H1 2025, supported by expansion in services and manufacturing, automotive investments, and infrastructure projects under the "Serbia Expo 2027" program. The unemployment rate fell to 8.5% in Q2 2025, down from 9.1% in the previous quarter. The NBS emphasized it will continue to monitor incoming data and adjust monetary policy as needed to support financial stability and favorable economic growth.