Serbia released its lowest annual inflation figure since 2016 on Monday. The rate fell to 1.5 percent in February, below the 1.9 percent forecast by analysts.

The dinar touched a three-week low and was trading at 118.2 at 0950 GMT, weaker by 0.2 percent.

Analysts said the fall in inflation could increase demand for five-year government bonds at an auction on Tuesday.

Strong appetite for Serbian debt has helped buoy the dinar in recent weeks, while other currencies in the region have weakened amid concerns over a rise in global inflation and interest rates.

The Serbian central bank (NBS) has repeatedly sold the currency to stem its strength.

"From an inflation perspective ... a moderate downwards adjustment to the 3.50 percent base rate would be justified," Raiffeisen analyst Stephan Imre said in a note.

"However, we assume that NBS will walk the talk and wait for EM/RSD market reaction to the 21 March FOMC meeting."

The Polish central bank lowered its inflation forecasts last week, and Governor Adam Glapinski said he saw no reason to start to lift record-low interest rates before the end of 2020, knocking the zloty below the 4.2 percent line against the euro.

February inflation figures are due on Thursday, with a drop expected in the annual reading to 1.7 percent in February from 1.9 percent in January. That is weighing on the zloty even though markets are still pricing in a rise in rates next year.

The zloty eased 0.1 percent to 4.21 against the euro, near its weakest levels of the past three months.

The Czech crown firmed 0.1 percent to 25.435 versus the euro but was still trading near two-month lows.

The leu was steady at 4.6616, after Romanian data showed a rise in annual inflation to 4.7 percent in February from 4.3 percent in January.

The rate is the highest in the region after a surge in the past year, but the February figure was in line with expectations.

Net wages, which fuel inflation, continued to rise robustly in the year to January but slowed to 8 percent from 11.7 percent in December.

Erste analysts said in a note dated March 12 that they expected two further Romanian central bank rate hikes this year.

"(These will be) data-dependent ... and connected to the decisions of other central banks in the CEE region in order to avoid a high interest rate differential," they added.