Serbian central bank says inflation expected to reach up to 7 percent next year

“According to an Ipsos survey, the financial sector expects inflation to be at 7.0% in August 2023, while the Bloomberg September survey reported lower inflation expectations of the financial sector for one year ahead (6.0%),” a press release said.

According to Ipsos, expected inflation of corporates for one year ahead went slightly up, from 7.0% in July, to 7.5% in August. Two- and three-year ahead inflation expectations of both the financial and corporate sector are lower than short-term expectations. Medium-term expectations of the financial sector continued to move within the NBS target tolerance band, at 4.5% for two years ahead, while running lower for three years ahead, at 3.5%. Medium-term inflation expectations of the corporate sector continued to range between 4.0% and 5.0%, it added.

Anchored medium-term inflation expectations on the back of preserved relative stability of the exchange rate enhance the efficiency of monetary policy in maintaining low, stable and predictable inflation in the medium run, which is one of the necessary preconditions of sustainable economic growth, the NBS said.