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National Bank of Serbia cuts policy rate

The National Bank of Serbia cut its key policy rate to 3.5% from 3.75%, amid low inflationary pressures.

The central bank said that annual inflation stayed within the target band since early 2017 and stood at 2.5% in August, while core inflation declined to 1.5% year over year.

Country risk premium fell to its lowest level on record for Serbia, and fiscal movements were more favorable than expected, with the country reporting a consolidated surplus of around 2% of GDP in the year to date, the central bank added.

It expects inflation to remain within the tolerance band of 3.0% plus or minus 1.5 percentage points "in the period ahead."