Serbia’s economy is entering the second half of 2026 in an unusual position: growth is accelerating, inflation has fallen below 2%, wages are rising strongly and foreign-exchange reserves are at record levels, yet foreign investment has weakened, external debt is increasing and bank credit is becoming a more important source of expansion.
The combination is broadly favourable.
It is also more complicated than the headline macroeconomic indicators suggest.
GDP growth accelerated to 3.6% in the second quarter, following 3.2% in the first, a clear improvement from the roughly 2% growth rates that characterised 2025.
Inflation moved in the opposite direction.
Annual consumer-price growth dropped to 1.9% in July, down from 2.7% in June.
Few macroeconomic combinations are more attractive than faster real growth and lower inflation.
Yet Serbia’s numbers also suggest that the engine underneath the recovery is changing.
Foreign direct-investment liabilities amounted to roughly €1.23 billion in the first six months, around 29% less than a year earlier.
Corporate bank lending, by contrast, increased rapidly, reaching approximately RSD 1.79 trillion by July, around 8.2% above the end-2025 level.
This is potentially the most important macroeconomic shift in the bulletin.
For much of the previous investment cycle, Serbia could rely heavily on foreign companies supplying equity capital to new plants and projects.
If FDI becomes less abundant while domestic credit expands, more risk migrates onto Serbian corporate and bank balance sheets.
That is not inherently negative.
A maturing economy should eventually be able to finance more of its own investment.
But the quality of the borrowing becomes crucial.
The same ambiguity appears in household finances.
Average net wages were almost 10% higher year on year in May, while inflation was only 3.5%. Household savings reached RSD 2.14 trillion by July.
Consumers therefore have more real income and substantial accumulated liquidity.
Retail sales are responding.
That provides an immediate boost to growth but can also strengthen imports, a concern for an economy that continues to run a sizeable merchandise-trade deficit.
The external accounts illustrate both Serbia’s progress and its limitations.
The current-account deficit narrowed by roughly 30% in the first half, to about €1.39 billion, but the goods deficit remained around €2.76 billion. A €1.34 billion services surplus and strong secondary-income flows provided essential offsets.
Another structural cost of Serbia’s foreign-capital model is becoming increasingly visible.
Primary-income outflows — which include profits, dividends and interest — reached about €2.8 billion in the first half.
Successful foreign-owned companies bring investment and exports, but over time they also send profits abroad.
That is normal. It nevertheless means Serbia must continually generate new export income to compensate.
The country’s financial defences are stronger than they have been in the past.
NBS foreign-exchange reserves reached more than €30.5 billion in July, while most of the country’s external debt is medium- or long-term.
That makes an immediate external financing crisis unlikely on the evidence contained in the bulletin.
The more relevant risk is gradual rather than dramatic.
Serbia could continue to grow through rising wages, consumer spending, bank lending, public investment and external borrowing while postponing the productivity improvements needed to service the resulting liabilities.
Or it could use the current period of low inflation, strong reserves and relatively robust growth to deepen domestic investment and move toward more productive, higher-value industries.
The first path can sustain respectable growth for some time.
The second would make that growth much more durable.
The July NBS bulletin suggests Serbia has reached the point where this distinction matters more than whether the next quarterly GDP number is 3.4%, 3.6% or 3.8%. The central economic question is shifting from how fast Serbia is growing to what is financing that growth and what productive capacity it is creating in return.
