The macroeconomic situation in Serbia is considerably better than three months ago, and the only thing that could destabilize it is the potential failure of the country's negotiations with the International Monetary Fund (IMF), which we believe is highly unlikely, the National Bank of Serbia Governor Radovan Jelasic stated Friday.

At a news conference, Jelasic assessed that it is not a matter of whether Serbia will reach an agreement with the IMF, but rather when this will happen, pointing out that it would be best if the agreement is reached during the next IMF's visit to Serbia, at the end of October.

Serbia's gross domestic product (GDP) will drop by 3.6 percent in 2009, central bank governor Radovan Jelasic said, adding that the second quarter contraction was 4.4 percent.

He also said that consumer price inflation in August will fall to 8 percent year-on-year from 8.5 in July.
The International Monetary Fund said earlier this week that Serb economy is likely to contract 4 percent in 2009.

No Change in the Key Policy Rate

After reviewing current economic developments in its meeting today, the NBS Monetary Policy Committee decided to keep the key policy rate unchanged at 12 percent.

In today’s meeting, the MPC also adopted the August 2009 Inflation Report.

The next MPC meeting is scheduled to take place on 23 September.