The National Bank of Serbia kept its key policy rate unchanged at 5.75% at its August 2026 meeting, extending a hold in benchmark borrowing costs that has been in place since September 2024. The steady stance suggests the central bank sees inflation and unemployment risks as broadly balanced, despite macroeconomic pressure from the war in the Middle East and its effect on global energy prices. July headline inflation slowed to a five-year low of 1.9%, placing it near the lower end of the NBS tolerance band of 1.5% to 4.5%. The Executive Board signaled that base effects (comparisons with earlier price levels) could push inflation up to 4% by September. The dinar also remained near 101 per U.S. dollar, close to its strongest level since late 2021, while expectations for GDP to strengthen later in the year reduced the case for easier financial conditions.