Using the flexibility of the existing monetary policy framework to change monetary conditions without changing the main interest rates, as of October the National Bank of Serbia raised the average effective rate in auctions of the repo sale of securities by 17 bp, hence it currently measures 0.28%. Also, repo purchase auctions of securities, which provided dinar liquidity to banks, were discontinued in October.
Higher debt levels may reflect a response to structurally lower interest rates and therefore structurally higher sustainable debt levels, but they can also create vulnerabilities. For example, despite the favorable economic conditions in recent years, very few countries have actually reduced their public debt ratio. In the current environment, governments do not face financing constraints.