Fitch Ratings has affirmed Serbia’s long-term foreign-currency sovereign rating at BB+ with a positive outlook, citing fiscal discipline, exchange-rate stability, strong foreign-exchange reserves and moderate public debt levels as key credit strengths.
The rating remains one level below investment grade. Fitch expects Serbia’s real GDP growth to reach 2.8% in 2026 before accelerating to 4.0% in 2027, partly supported by temporary economic activity linked to Expo 2027. The positive outlook keeps open the possibility of a future rating upgrade, although Fitch continues to identify institutional and external factors as remaining constraints.
Public Debt and Fiscal Position Support Rating Outlook
Serbia’s public debt is expected to remain broadly stable at around 44% of GDP between 2026 and 2028, compared with 44.7% in 2025. Fitch also expects the fiscal deficit to remain within the government’s target ceiling of 3% of GDP.
The agency highlighted fiscal discipline, exchange-rate stability, substantial reserve holdings and relatively moderate debt levels as important factors supporting Serbia’s sovereign credit profile. Fitch identified several ongoing vulnerabilities, including political uncertainty, high euroisation within the banking sector, current-account deficits and reliance on foreign financing.
Central Bank Keeps Policy Rate Unchanged
The National Bank of Serbia (NBS) maintained its key policy rate at 5.75% on 9 July. The central bank also kept the deposit facility rate at 4.50% and the lending facility rate at 7.00%.
The decision indicates that monetary easing is expected to remain limited while inflation risks and international energy-price pressures continue to influence economic conditions. For businesses, relatively high interest rates continue to affect borrowing costs, particularly for companies relying on dinar-denominated financing.
Foreign Reserves Remain Above €29 Billion
Serbia’s gross foreign-exchange reserves stood at €29.609 billion at the end of June, declining by €273 million from the record level of €29.882 billion reached in May. The reserve position remains sufficient to cover approximately 6.8 months of imports, providing the central bank with a significant buffer against currency volatility and external financing pressures.
The combination of strong reserves, exchange-rate stability and fiscal control supports sovereign and currency stability. At the same time, companies continue to face relatively costly domestic-currency financing conditions, while project borrowers are expected to maintain strong cash-flow coverage, generate hard-currency revenues or apply effective hedging strategies.
