Due to the false interpretation of the latest inflation projection National Bank of Serbia on the part of the "Vreme" portal, we take the opportunity to once again repeat the details of the February inflation projection. In the article it is stated that the projection from the Inflation Report differs from the allegations made by the governor at the conference where the report was presented Jorgovanka Tabakovic, which does not correspond to the facts.
For this reason, we point to the following facts that were clearly communicated both at the conference and in the report itself:
After the end of the Regulation on special conditions for conducting trade for a certain type of goods, no major increase in prices is expected, because the adoption of systemic laws that will improve market regulation will prevent the occurrence of unfair trade practices and contribute to the fact that trade margins do not return to the level before the adoption of the Regulation.
The projected also speaks in support of this inflation which will hover around the central target value of 3% until September of this year.
From September, due to the effect of the low base from the same month of 2025, when the Regulation entered into force, we expect year-on-year inflation to grow to around 4%. In other words, even without an increase in consumer prices in September of this year on any basis, from a mathematical point of view there is an increase in year-on-year inflation due to the departure from the year-on-year calculation of the monthly drop in consumer prices from last September of 1,6%.
That no significant inflationary pressures are expected is indicated by the projected average annual inflation of 3,3% this year, which is lower than the 3,8% average inflation in 2025.
The fact that the inflation projection was communicated in the same way and that no higher price growth is expected after the end of the Regulation is indicated by the following quote from the opening address of the governor at the presentation of the Inflation Report - February 2026: "Our new inflation projection is similar to the November one - we expect that the annual inflation until September of this year will be around the central value of the target, and then, due to the effect of the low base, above all for food prices, at the end of this year, it will amount to around 4%."
We would like to remind the public of our earlier analyzes and reviews from the inflation report, in which we showed how the base effect affects the interannual dynamics of inflation. On the basis of the given graphic representation, it can be seen that, viewed only on the basis of a drop in the price level under the influence of some factor, in this case the Regulation, even assuming that those prices later remain at an unchanged level, the year-on-year inflation will record an increase after one year. How much annual inflation growth will be achieved will also depend on other factors that will affect the level of current inflation."
Photo: National Bank of SerbiaGraph
