Mild optimism is the term used by economists and bankers at the Naled panel to assess the current year of 2024. This implies an economic growth of three and a half percent, along with a decline in inflation and interest rates in the domestic market and the Eurozone. Challenges persist when it comes to balanced growth, the labor market, and unforeseen international circumstances.
Bankers anticipate challenges but state that much depends on us as well. We can rely more on the participation of domestic private investments and expenditures than on external factors. Investments and consumption are highly dependent on interest rates, and there is speculation that they could gradually decrease from the summer onwards.
“Market projections show, for example, that the three-month Euribor, which is crucial for our citizens and clients in a broader context, could be in a range from 2.5 percent, which is some of the most optimistic estimates after yesterday’s ECB meeting, to 2.9 percent at the end of the year,” says Milan Zečević from Erste Bank.
What concerns clients, especially those with housing loans, is the situation with the country’s economy at the end of the year and whether there will be an extension of the moratorium.
“As interest rates and the cost of money fall, we will likely see an increased volume of lending, considering the real estate market situation – noticing some stagnation, but not experiencing significant declines as previously announced,” says Nikola Stakić, a professor at the University of Singidunum.
Nikola Vuletić, the president of the executive board of UniCredit Bank, states that the growth will come from private consumption.
“It is important that the growth will come from the increase in private consumption, slowing inflation, probably returning inflation to targeted corridors likely by the end of the year, reducing interest rates, increasing general wage levels; all of these will affect the growth of private consumption. Also, a deficit of 2.3 percent is considered good,” adds Vuletić.
Improved conditions will also be contributed by significant investments within the framework of the Expo exhibition
The United Nations believes that it is time to provide fast responses to long-term problems. This relates to energy transition as well as sustainable growth.
“We can talk about the economy growing by three and a half percent here, but to have sustainable growth, you must also take into account the quality of education and healthcare. The quality of air and the environment. People leave, but they also come. The fluctuation of the workforce is a good sign because when the demand for workers increases, the economy grows,” says François Jacrot, the UN Resident Coordinator in Serbia.
Economists expect that dinar interest rates will decrease to at least five percent, which will stimulate lending and consumption. They also state that significant investments in the Expo exhibition will contribute to a better environment.
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