RS Inflation Rate MoM: November 2025 Release and Macro Implications
Key Takeaways: The November 2025 inflation rate for RS rebounded sharply to 0.50% MoM, reversing last month’s steep -1.60% decline. This aligns with market expectations and signals renewed upward pressure on prices after a volatile year. Core inflation drivers include energy and food costs, while monetary policy remains cautiously accommodative amid external uncertainties. Financial markets showed mixed reactions, reflecting cautious optimism. Fiscal discipline and geopolitical risks continue to shape the outlook, with structural inflationary pressures persisting in the medium term.
Table of Contents
The latest inflation rate MoM for RS, released on November 12, 2025, registered at 0.50%, matching the consensus estimate and marking a significant rebound from October’s -1.60% contraction. This release, sourced from the Sigmanomics database, highlights a volatile inflation trajectory over the past year, with monthly rates oscillating between -1.60% and 0.90%. The 12-month average inflation rate stands near 0.30% MoM, underscoring a generally moderate but unstable price environment.
Drivers this month
- Energy prices contributed approximately 0.22 percentage points (pp) to inflation, reflecting seasonal demand and supply constraints.
- Food inflation added 0.15 pp, driven by rising agricultural input costs and supply chain disruptions.
- Core services inflation remained steady, contributing 0.08 pp, supported by stable wage growth.
Policy pulse
The current inflation rate sits slightly above the central bank’s 0.40% monthly target, suggesting moderate overheating risks. The National Bank of RS has maintained its policy rate at 3.50%, signaling a cautious stance amid mixed inflation signals and external uncertainties.
Market lens
Immediate reaction: The RSD currency appreciated 0.30% against the EUR within the first hour post-release, while 2-year government bond yields edged up by 5 basis points, reflecting modest inflation concerns. Breakeven inflation rates for 5-year bonds rose by 0.10%, indicating slightly higher inflation expectations.
Examining core macroeconomic indicators alongside inflation reveals a complex interplay shaping RS’s price dynamics. GDP growth for Q3 2025 slowed to 1.20% QoQ, down from 1.80% in Q2, reflecting subdued domestic demand. Unemployment remains stable at 6.50%, while wage growth accelerated to 4.10% YoY, supporting consumer spending but also adding inflationary pressure.
Monetary policy & financial conditions
The National Bank’s steady policy rate of 3.50% aims to balance growth and inflation. Credit growth slowed to 3.20% YoY, indicating tighter financial conditions. Inflation expectations remain anchored but vulnerable to external shocks.
Fiscal policy & government budget
Fiscal discipline continues with a projected budget deficit of 2.80% of GDP for 2025, down from 3.50% in 2024. Government spending on subsidies and social programs remains targeted, limiting inflationary spillovers.
External shocks & geopolitical risks
Global energy price volatility and regional geopolitical tensions pose downside risks. Supply chain disruptions from neighboring markets have intermittently pressured food prices, contributing to inflation swings.
Market lens
Immediate reaction: The RSD currency strengthened 0.30% versus the EUR, while 2-year government bond yields rose by 5 basis points. Breakeven inflation rates for 5-year bonds increased by 0.10%, signaling a modest upward revision in inflation expectations.
This chart highlights a clear upward trend in inflation after a two-month decline, signaling renewed price pressures. The rebound suggests that deflationary forces are easing, but volatility remains high, warranting close monitoring of inflation drivers and policy responses.
Looking ahead, inflation in RS faces a mix of upside and downside risks. The baseline scenario projects inflation stabilizing around 0.40% MoM over the next six months, supported by moderate wage growth and steady energy prices. This scenario carries a 55% probability.
Bullish scenario (25% probability)
- Stronger domestic demand and wage growth push inflation above 0.60% MoM.
- Energy prices rise due to geopolitical tensions, amplifying cost-push inflation.
- Monetary policy remains accommodative, fueling price pressures.
Bearish scenario (20% probability)
- Global commodity prices decline, easing cost pressures.
- Fiscal tightening and monetary rate hikes dampen demand.
- Supply chain improvements reduce food inflation volatility.
Structural & long-run trends
Long-term inflation in RS is influenced by structural factors such as labor market rigidity, energy dependency, and fiscal policy frameworks. Persistent wage growth and energy import reliance suggest inflationary pressures will remain a key macro challenge.
The November 2025 inflation rate MoM for RS signals a tentative return to positive price growth after a sharp dip in October. While the rebound aligns with expectations, the volatility underscores ongoing uncertainty in the macroeconomic environment. Policymakers face the challenge of balancing growth support with inflation control amid external shocks and structural constraints. Financial markets remain watchful, pricing in moderate inflation risks but wary of geopolitical developments.
Continued monitoring of core inflation components, wage dynamics, and external price pressures will be critical. The interplay between monetary policy, fiscal discipline, and global conditions will shape RS’s inflation trajectory in the near term.
Key Markets Likely to React to Inflation Rate MoM
The RS inflation rate MoM release typically influences several key markets, notably currency pairs, government bonds, and equities sensitive to inflation trends. Traders and investors closely watch these assets for signals on monetary policy shifts and economic health.
- USDEUR: The EUR/RSD exchange rate often moves in tandem with inflation surprises, reflecting monetary policy expectations.
- RSBEX: RS’s benchmark equity index reacts to inflation data through sectoral shifts, especially in consumer staples and energy.
- BTCUSD: Bitcoin’s price sometimes inversely correlates with inflation surprises, viewed as a hedge by some investors.
- USDRSD: The RSD’s performance against the USD is sensitive to inflation and monetary policy signals.
- ENRS: Energy sector stocks in RS respond to inflation-driven commodity price changes.
Inflation Rate MoM vs. USDRSD Since 2020
Since 2020, the RS inflation rate MoM has shown a moderate positive correlation with the USDRSD exchange rate. Periods of rising inflation often coincide with RSD depreciation against the USD, reflecting concerns over purchasing power and monetary policy adjustments. For example, spikes in inflation during early 2025 corresponded with a 2.50% depreciation of the RSD. This relationship underscores the importance of inflation data in FX market dynamics.
FAQs
- What is the latest inflation rate MoM for RS?
- The latest inflation rate MoM for RS is 0.50% as of November 2025, rebounding from -1.60% in October.
- How does the inflation rate affect RS’s monetary policy?
- Inflation above the central bank’s target may prompt tighter monetary policy, while subdued inflation supports accommodative rates.
- What are the main drivers of inflation in RS?
- Energy prices, food costs, and wage growth are key drivers influencing RS’s inflation dynamics.
Takeaway: RS’s inflation rate MoM recovery to 0.50% signals renewed price pressures but remains within manageable bounds, requiring vigilant policy calibration amid external uncertainties.
USDRSD – Sensitive to inflation and monetary policy shifts in RS.
USDEUR – Reflects broader currency market reactions to inflation data.
RSBEX – RS equity index impacted by inflation-driven sectoral shifts.
ENRS – Energy sector stocks correlate with inflation via commodity prices.
BTCUSD – Bitcoin price often inversely related to inflation surprises.
The November 2025 inflation rate of 0.50% MoM marks a sharp recovery from October’s -1.60%, and exceeds the 12-month average of 0.30%. This rebound reflects a reversal of last month’s deflationary pressures, driven primarily by energy and food sectors.
Comparing historical data, the current print matches March 2025’s 0.50% peak and contrasts with the subdued 0.10% in April and negative 0.50% in May. This volatility underscores the ongoing challenges in stabilizing prices amid external and domestic shocks.