September 8 (SeeNews) - Serbia's central bank decided to increase its key repo rate by 50 basis points to 3.5% amid inflationary pressures, it said on Thursday.
The central bank also decided to set the deposit facility rate at 2.5% and the lending facility rate at 4.5%, it said in a statement.
Inflationary pressures on the global and domestic markets proved to be stronger and more persisting than previously expected, National Bank of Serbia (NBS) noted, adding that the trend requires further tightening of monetary policy.
The latest data published by the national statistical office showed that Serbia's consumer prices increased by 12.8% year-on-year in July, after rising by 11.9% the month before.
The NBS added that the inflation should return to the target band of 4±0.5% in the second half of next year which will be aided by the current stricter monetary policy.
The central bank will hold its next rate-setting meeting on October 6.