Serbia Economic and FDI Outlook
Na Inflation Will Follow Downward Path in the Coming Period
Inflation should return to the target tolerance
band most likely in May 2024...
Chart 3 Inflation projection (February 2024 IR)
(average y/y rates in % per quarter and contributions in pp)
approaching the target midpoint at the end
of the year.
Chart 4 Inflation projection (February 2024 IR)
(y/y rates, in %)
18
16
14
12
10
086420
17
16
15
8765
14
13
12
11
10
109
8
7
6
Non-food
Regulated prices
Oil derivatives
-2
Q4
Food
Q2
2022
Q4
Q2
2023
Consumer prices
Q4
Q2
2024*
1
5432TO
0
Q4*
Q2
2025*
Q4*
-1
12
3
*NBS Forecast
2022
6 9 12 3 6 9 12 3 6 9
2023
2024
12 3 6 9
2025
12
Inflation slowdown is the result of the effects of past
monetary tightening, the slower pace of imported inflation,
the decrease in inflation expectations, as well as the easing
of cost-push pressures.
•Cost-push pressures are weakening due to the fall in prices
of primary agricultural commodities and certain industrial
raw materials.
•
• Disinflationary effect also comes from subdued aggregate
demand due to slackened global growth.
•
•
The key risks to the projection are mostly related to external
environment and refer to geopolitical conditions and the
outlook for global economic growth, and their impact on
global energy and commodity prices.
As for the factors from the domestic environment, the
projection risks are mainly associated with the pace of the
recovery of domestic demand and the outcome of this year's
agricultural season.
• Overall, the risks of the inflation projection are assessed as
symmetric.
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