Central bank committed to inflation target

Serbian central bank (NBS) chief Dejan Šoškić says this institution will not give up the set inflation target of 4.5 pct - plus/minus 1.5 pct - for 2011.

Izvor: Tanjug

Tuesday, 02.11.2010.

13:24

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Serbian central bank (NBS) chief Dejan Soskic says this institution will not give up the set inflation target of 4.5 pct - plus/minus 1.5 pct - for 2011. Addressing the Economic Summit in Belgrade on Tuesday, Soskic pointed out that in the next year, the inflation rate will be influenced by the unfreezing of salaries and pensions which will put stronger pressure on the demand, and that the issue of price fluctuation under state control will remain open. Central bank committed to inflation target The NBS governor said that 2011 will probably be marked by election preparations, which will “loosen the appropriate expenditure limitations.” Soskic underscored that the price fluctuation of agricultural products in Serbia is much more unstable than in the neighboring countries, noting that there is still room for the development of the policy of intervention from the Buffer Stocks, subsidies and levies, which would cushion the unpredictable fluctuation of such prices. He announced that after the current talks with the IMF Mission, the NBS and government representatives will discuss the ways in which present policy could be improved so as to help avoid the instability of food prices Serbia witnessed in 2010. The World Bank supports the National Bank of Serbia (NBS) in setting a target inflation for 2011, but adds the fiscal and monetary policies will have to be adjusted to achieve success, World Bank Country Manager for Serbia Loup Brefort said Tuesday. The NBS target inflation for next year is 4.5 percent plus or minus 1.5 percent. Speaking at Serbia's 10th Economic Summit, Brefort noted that the course of the inflation will not be known until January, when the freeze on salaries and pensions is lifted. The World Bank would like to see restrictive pension and monetary policies, Brefort remarked. The NBS will probably have to introduce restrictions to keep the inflation within the targeted values, and it will need government assistance to achieve that, Brefort stated. The credit funds that are available to Serbia from the World Bank have gone up to EUR 9 billion after the last round of negotiations, Brefort said. Dejan Soskic (Tanjug)

Central bank committed to inflation target

The NBS governor said that 2011 will probably be marked by election preparations, which will “loosen the appropriate expenditure limitations.”

Šoškić underscored that the price fluctuation of agricultural products in Serbia is much more unstable than in the neighboring countries, noting that there is still room for the development of the policy of intervention from the Buffer Stocks, subsidies and levies, which would cushion the unpredictable fluctuation of such prices.

He announced that after the current talks with the IMF Mission, the NBS and government representatives will discuss the ways in which present policy could be improved so as to help avoid the instability of food prices Serbia witnessed in 2010.

The World Bank supports the National Bank of Serbia (NBS) in setting a target inflation for 2011, but adds the fiscal and monetary policies will have to be adjusted to achieve success, World Bank Country Manager for Serbia Loup Brefort said Tuesday.

The NBS target inflation for next year is 4.5 percent plus or minus 1.5 percent.

Speaking at Serbia's 10th Economic Summit, Brefort noted that the course of the inflation will not be known until January, when the freeze on salaries and pensions is lifted.

The World Bank would like to see restrictive pension and monetary policies, Brefort remarked.

The NBS will probably have to introduce restrictions to keep the inflation within the targeted values, and it will need government assistance to achieve that, Brefort stated.

The credit funds that are available to Serbia from the World Bank have gone up to EUR 9 billion after the last round of negotiations, Brefort said.

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