Serbia’s central bank raised interest rates by 25 bps to 5.5%, in line with expectations. The bank noted that the global outlook has somewhat improved in correction in energy prices and the stabilization of supply chains following China’s re-opening. However, the bank remains wary of persistent inflationary risks on a global level, namely a potential rebound in energy prices, which calls for a cautious policy approach in the future. Headline inflation is likely to start falling in H2 2023. The bank sounded hawkish and will likely hike rates by another 50 bps, but simultaneously, the end of the hiking cycle seems near.