Research Detail
| 2024/09/13 / Erste Group Research |
Growth remains strong; hunt for IG rating continues While EU growth struggles continue in 2024, Serbia marches on posting 4.3% y/y growth in 1H24, coming in only behind Malta when comparing to EU members. Growth is predominantly consumption driven but investments are also picking up momentum. Inflation has returned to the target band and has been hovering around the 4% mark in recent months. Due to demand side pressure and expected poor agricultural season we have adjusted our inflation expectations slightly to the upside. MoF is targeting the same budget gap as last year (2.2% of GDP) despite recording 0.8% of GDP budget surplus after 7M24. The refinancing situation is comfortable as almost a 12% of GDP cash buffer offsets the need for new issuance for now. Hard currency bonds lost some ground in terms of spread in September, but on a longer-term perspective they are still enjoying a solid yearly performance. The thing that obviously worries some investors has Serbia reached its limits in terms of spread compression. An impressive list of key political figures visited Serbia recently, indicating once again the utmost importance of Serbia’s role in the Balkan region. |
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General information
| Author | Erste Group Research |
| Date | 2024/09/13 |
| Language |  |
| Product name | CEE Country Macro Outlook |
| Topic in focus | FX, Macro/ Fixed income |
| Economy in focus | Serbia |
| Currency in focus | Serbian dinar |
| Sector in focus | - |
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