The National Bank of Serbia (NBS) on Friday advised business banks, ahead of the World Savings Day - October 31, to keep interest rates on foreign exchange deposits at a level similar to the rest of the year in order to prevent more expensive loans.

Not neglecting the importance of the free market and competition, transperent business practices and the autonomy of business bank strategies, the NBS advised balks to avoid unsustainable fluctuations in interest rates, which can potentially create expensive sources of financing in the banking system and liquidity imbalances.

The NBS advised business banks not to raise interest rates on savings during the upcoming Savings Week, as expensive deposits can only be put back into the market as expensive loans and can increase the risk in the banking system.

This recommendation should help establish a sustainable interest rate level, which will contribute to lower prices of banking services, including loan interest rates. In addition, banks should work to attract more savings in dinars, which will contribute to greater stability of the banking sector, said the NBS.