NBS: The interest rate stays the same

The Executive Board of the National Bank of Serbia (NBS) decided today to keep the key policy rate at the level of three percent, the NBS announced.

It is estimated that the inflation, as expected, returned to the target limits and in August it amounted to 2.6 percent, while it is expected that inter-annual inflation and inflation in the next two years will remain within the target limits.

„The economy of Serbia has been growing steadily since the beginning of the year, at the highest rate in the last ten years, which is also contributed to by the prior mitigation of the monetary policy of the NBS, and the Executive Board estimates that this year’s economic growth will amount to over four percent, with a high contribution of investments, which will, in the upcoming period, allow the continuation of the dynamic growth of export of the processing industry,“ the NBS said.

It was pointed out that the growth of investments was supported by favourable conditions of financing and growth of credit activity, and that the net inflow of foreign direct investments, which more than fully covers the current account deficit, contributes to reducing the external imbalance in the medium term through the impact on the growth of export.

The NBS Executive Board believes that caution in the conduct of monetary policy is still necessary, first of all taking into account developments in the international environment, such as the fluctuation of the world oil price, US and EU monetary policies, and the growing protectionism in international trade.

The resilience of Serbia’s economy to potential negative impacts from the international environment has increased owing to more favourable macroeconomic indicators and prospects for the next period, NBS said.

The next session of the Executive Board, at which the decision on the key policy rate will be made, will be held on November 8.

Izvor: Beta

Foto: BIZLife