repo operations

National Bank of Serbia’s repo operations: Liquidity withdrawal and inflation control

Since November 2022, the National Bank of Serbia (NBS) has been actively withdrawing liquidity from the market via reverse repo operations (repo sales of treasury bills). This practice aims to manage excess dinar liquidity in the banking sector and maintain price stability. Reverse repo transactions involve the NBS selling treasury bills to banks with an agreement to repurchase them later, typically within seven days, paying interest (~4.5% on average in 2025). This temporarily absorbs liquidity from banks. On July 9,…