Serbia’s central bank raised its benchmark interest rate for a fourth month by 25bps to 2.75%, the highest level since July 2019. According to the nation’s statistics office, the annual inflation rate, at 10.4% in May, peaked in June but will ease in July. Benchmark interest rate hikes helped ease pressure on the Serbian dinar, which the bank keeps in a narrow range against the euro by intervening in the local currency market. From October 2021 to April 2022, the bank spent more than $2.8bln to fend off depreciation pressures, but switched to net purchases in May, a sign of revived demand for the currency.