map Serbia
Inflation has begun to decelerate, but much more slowly than elsewhere in the Western Balkans, owing to the government’s decision to raise the price of electricity and gas from the start of the year, and to remove the price caps on certain essential food items that were imposed last year. High inflation eroded real incomes in the first quarter of the year, dragging down household consumption. Additionally, government consumption also declined. As a result, GDP expanded by just 0.7% in Q1, falling short of our earlier expectations. Following a brief hiatus in May, the central bank decided to raise its interest rate once again in June, making it unclear whether the tightening cycle is over. Given these developments, we have adjusted our 2023 inflation forecast 2 percentage points (pp) upwards, to 12%; at the same time, we have revised our GDP forecast 0.2 pp downwards, to 1.3%. An upside risk to the outlook is the robust performance of foreign direct investment and remittances, which both grew by more than 30% in Q1. On the other hand, downside risks stem from the emergence of a new wave of anti-government protests in the country and the deteriorating situation in Northern Kosovo.
Main Economic Indicators202020212022202320242025
Population, 1000 persons689968346664...
GDP, real change in %-
GDP per capita (EUR at PPP)128101435015530...
Gross industrial production, real change in %
Unemployment rate - LFS, in %, average9.
Average gross monthly wages, EUR706772880...
Consumer prices, % p.a.
Fiscal balance in % of GDP-8.0-4.1-3.2-2.5-2.0-1.5
Public debt in % of GDP57.857.155.6...
Current account in % of GDP-4.1-4.2-6.9-5.5-4.5-4.0
FDI inflow, EUR m303938864416...
Gross external debt in % of GDP65.868.469.4...

Basic data are continuously updated.

* Forecasts are changed beginning of January, April, July and November.
See Press Conferences.


Monthly Report No. 7-8/2023

Vasily Astrov, Alexandra Bykova, Rumen Dobrinsky, Selena Duraković, Meryem Gökten, Richard Grieveson, Doris Hanzl-Weiss, Gabor Hunya, Branimir Jovanović, Niko Korpar, Sebastian Leitner, Isilda Mara, Olga Pindyuk, Sandor Richter, Bernd Christoph Ströhm, Maryna Tverdostup, Nina Vujanović, Zuzana Zavarská and Adam Żurawski
wiiw Monthly Report No. 7-8, July-August 2023
51 pages including 3 Tables, 24 Figures and 1 Box



Executive summary

Olga Pindyuk
in: Sailing Through Rough Waters
wiiw Forecast Report No. Spring 2023, April 2023 , pp. I-VI