C-bank cuts key interest rate

The National Bank of Serbia (MBS) Monetary Board has decided to lower its key reference rate from 14 to 13 percent. It was announced in Belgrade on Monday that the decision came despite the fact that the fiscal policy is expansive, above all due to the lower-than-expected budget revenues. C-bank cuts key interest rate But the central bank said in bore in mind that the new restrictive measures of the fiscal policy are yet to yield results in decreasing the budget deficit, and that for this reason, the fiscal policy should in the coming period have deflationary character. The drop in the economic and trade activity is higher than expected, the statement continued, while demand remains low. The NBS said it believes that this factor will also have a deflationary effect in the coming period.

C-bank cuts key interest rate

But the central bank said in bore in mind that the new restrictive measures of the fiscal policy are yet to yield results in decreasing the budget deficit, and that for this reason, the fiscal policy should in the coming period have deflationary character.

The drop in the economic and trade activity is higher than expected, the statement continued, while demand remains low.

The NBS said it believes that this factor will also have a deflationary effect in the coming period.