The economic recovery is expected to start next year, which should bring investments of better quality and help repair the financial position of the corporate sector. The current challenge for lending activity and foreign capital inflows across the region, Serbia included, is the deleveraging of EU banks and their potential withdrawal from these markets.
In response to the unique features of the recovery, monetary policy remained unusually stimulative long into the expansion, with BIS Review 4/1997  -7-  the Federal Reserve maintaining a 3% nominal federal funds rate and near-zero real federal funds rate for three years into the current expansion.