According to the Serbian Statistical Office, y-o-y inflation hit its all-time low of 0.1% in January, due to the effect of high last year’s base resulting from the increase in the VAT rate. The primary causes of low inflation in the course of the last year were a sudden drop in prices of petroleum products (-0.6 pp) and cigarettes (-0.4 pp), and the absence of electricity price increase (which would have contributed an estimated 0.7 pp). During the same month, the growth of core inflation (excluding food, energy, tobacco products and alcohol beverages) also slowed down, to 1.7% y-o-y.
On a monthly level, January saw a drop in consumer prices of 0.2%, driven by lower prices of petroleum products, travel arrangements and medicaments, while seasonal growth in vegetable prices worked in the opposite direction.
The NBS estimates that y-o-y inflation will start to rise from February and gradually return within the target band (4±1.5%) reports National Bank of Serbia.
Source; Balkans
