TABAKOVIC: Inflation under control, NIS to contribute to economic growth

(Jorgovanka Tabakovic)

The National Bank of Serbia (NBS) expects the inter-annual inflation to return to the limits of allowed deviation from the target rate of 4 percent plus or minus 1.5 percent by the end of the year, Tanjug news agency reports.

Inflation will continue increasing for several more months due to the expected increase in government-regulated prices and low base in the previous year, NBS Governor Jorgovanka Tabakovic told a news conference.

The governor said that the production of the Petroleum Industry of Serbia (NIS) in 2013 to contribute to an increase in the local economy by 0.5 percent and if NIS manages to process 3 million tons of crude oil this year, it will have an effect on the reduction of foreign exchange deficit by EUR 100 million.

At the press conference during which the report on inflation was presented, General Director of Monetary Analysis and Statistics Branko Hinic said that the increase of the monetary policy's restrictiveness, fiscal consolidation measures and a drop of the risk premium were the key factors that led to the strengthening of the dinar since September, which changed the depreciation trend from the first seven months of the year.