interest rates in the markets of money, loans and savings, indicating the efficiency of the transmission mechanism through the interest rate channel. the ecb ’ s continued monetary policy normalisation pushed up the interest rates on euro - denominated loans at home. lending activity rose by 7. 3 % at annual level, and continued to be led mostly by corporate loans. it is also important to note that the share of npls in total loans fell to a new low of 3 % in december, indicating that the increase in loan repayment costs did not affect the quality of banks ’ assets and that financial stability has been preserved even during the multidimensional crisis we have been facing for the past three years. 6 оf 10 chart 8 lending activity to the non - monetary sector chart 9 npl level and share in total loans, gross principle ( y - o - y growth rates in %, excluding the exchange rate effect ) ( in rsd bn ) ( in % ) household sector corporate sector other sectors npl share in total loans ( rhs ) - 5 households enterprises total - 10 - 15 source : nbs. dec source : nbs. in making the decision on the key policy rate, we assessed that the current tightening of monetary conditions would not have a major negative impact on domestic demand. factors at home, such as the continuation of positive trends in the labour market and the success in attracting fdis, continue to prop up economic growth. on the other hand, economic activity at home slackened in h2 2022 as expected, reflecting subdued external demand, heightened global cost - push pressures and drought which resulted in lower agricultural yields. according to the preliminary sors estimate, serbia ’ s real gdp growth measured 0. 4 % y - o - y in q4 2022, and 2. 3 % in 2022 as a whole, which is largely consistent with the nbs ’ s november projection. under our new projection, serbia ’ s gdp growth rate this year will range between 2. 0 % and 3. 0 %, unchanged from our november expectations. the risks to the projection are estimated to be less pronounced than three months ago, as the uncertainty regarding gas supply to europe has decreased and economic activity indicators for the euro area at end - 2022 and early this year turned out better than expected. assuming that the global economy and, by extension, external demand recover as of the second half of 2023, and in view of the planned implementation of investment projects, primarily

in road, railway, energy and utility infrastructure, we expect gdp growth to accelerate from 2024 to the range of 3. 0 – 4. 0 %, and return to the pre - pandemic growth trajectory of around 4 % p. a. thereafter. 7 оf 10 chart 10 gdp growth projection chart 11 contributions to real gdp growth, expenditure side ( y - o - y rates, in % ) ( in pp ) 7. 5 4. 5 4. 3 2. 0 3. 5 3. 3 2. 9 1. 8 4. 0 2. 3 2. 5 2. 1 - 2 - 4 - 2 - 6 - 4 iv i source : nbs. - 0. 7 - 0. 9 change in inventories net exports government consumption gross fixed capital formation household consumption gdp ( in % ) - 1. 6 - 8 ii iii iv i ii iii iv i ii iii iv i ii iii iv 2023 * 2025 * sources : sors and nbs. * nbs estimate. this year ’ s gdp growth will be led by domestic demand, primarily private consumption and inventories. on account of lower production costs and reduced global uncertainty, as well as relatively high planned government capital investment, as of next year we also expect a relatively high contribution from fixed investment, whose share in gdp should remain close to 23 %. on the other hand, due to the expectedly high imported quantity of key energy commodities – gas and oil, and a cautious approach to euro area growth, net exports are projected to provide a negative contribution to gdp this year. as of 2024 their contribution is expected to turn out mildly positive, consistent with the expected recovery of external demand and the effects of new investment in export - oriented sectors. the current account deficit amounted to 6. 9 % of gdp in 2022 and was by around 2 pp lower compared to our november projection. the better than anticipated outturn was primarily a result of lower than expected energy imports in the last quarter thanks to a global energy price drop, faster real growth in goods and services export and a higher surplus in the secondary income account. the current account deficit was fully covered by net fdi inflows for the eighth year in a row, supporting the sustainability of our external position. the record high fdi inflow remained geographically and project - diversified in 2022 as well and channelled mainly to tradable sectors. you can read more about balance of payment trends in 2022 and factors behind