Serbian banks, businesses expect 7.1-10 pct one-year ahead inflation

BELGRADE - According to an Ipsos survey, the Serbian financial sector expects December 2023 inflation to amount to 8.0 pct, unchanged for the third consecutive month, while a Bloomberg January survey reported lower one-year ahead inflation expectations of 7.1 pct, the National Bank of Serbia (NBS) said.

"Short-term inflation expectations of corporates (one-year ahead) stabilised in the last four months around 10.0 pct, this being precisely their level in the December survey," the central bank said in a statement.

"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 stayed unchanged relative to the previous survey, measuring 5.0 pct for two years ahead, while three-year ahead expectations kept moving within the NBS target band, at 4.0 pct. Corporates expect inflation at the level of 5 pct for both periods, with two-year ahead expectations declining from the 7.0 pct reported in November.

The results of the survey for two and three years ahead might indicate that both the financial and the corporate sector expect a waning of inflationary pressures in the coming period and the gradual return of inflation within the target tolerance band in the medium run," the NBS also said.