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UPDATE 1 - Serbia's c-bank holds key repo rate at 2.5%

Author Radomir Ralev
UPDATE 1 - Serbia's c-bank holds key repo rate at 2.5% Photo: Srbija Danas/Sasa Dzambic

BELGRADE (Serbia), September 12 (SeeNews) - Serbia's central bank said on Thursday it decided to keep its key repo rate unchanged at 2.5%.

The central bank was guided by the medium-term inflation projection and the expected development of other macroeconomic indicators from the domestic and international environment, the central bank, NBS, said in a statement. 

"Low inflationary pressures are also indicated by the core inflation, which remains low and stable, as well as the lower inflation expectations by the financial sector and the economy in the lower part of he target for one and two years ahead," the NBS said.

Serbia's average consumer prices rose by 1.6% year-on-year in July, after growing by 1.5% in June, according to the latest official data available. On a monthly comparison basis, Serbia's consumer price index (CPI) fell by 0.2% in July, after decreasing by 0.3% in June.

The central bank estimates that the impact of trade tensions and the potential effects of the policies of the world's leading economies on global trends causes uncertainty in the international financial and commodity markets.

However, the resilience of the Serbian economy to a potential negative impact from the international environment has increased, owing to improved macroeconomic indicators and prospects.

The central bank cut the key repo rate by 0.25 of a percentage point to 2.75% in July and to 2.5% in August to help guide inflation to the target band.

The NBS will hold its next rate-setting meeting on October 10.