The National Bank of Serbia has decided to cut its key repo rate to 1.25% from 1.5%, bringing borrowing rates to the lowest since at least 2006, Trading Economics reports. Markets were expecting no changes.
Policymakers said the strongest impact of the crisis was felt in April, as in other European countries, and that the economy should recover in the coming months.
The inflation is likely to move around the lower end of the 1.5%-4.5% target band until the end of 2020, due to lower demand and oil prices, before gradually approaching the target midpoint in the medium-term, the NBS said.
Serbia’s consumer prices rose by 0.6% year-on-year in April, after growing by 1.3% in March, official statistics show.
On a monthly comparison basis, Serbia’s consumer price index (CPI) remained flat in April, after declining by 0.1% in March, Trading Economics said on June 11.