BCT: The key rate will remain unchanged at 8% in the face of inflation risks

BCT: The key rate will remain unchanged at 8% in the face of inflation risks
BCT: The key rate will remain unchanged at 8% in the face of inflation risks

“The Board of Directors of the Central Bank of Tunisia (BCT) decided to maintain the key rate of the BCT unchanged at 8%,” announced the BCT, in a press release, published Friday.

The CA estimated during its meeting held on Thursday that “the risks surrounding the future trajectory of inflation call for caution and patience, and that it is important to continue to support the process of convergence of inflation towards sustainable levels.

He also revealed that upward risks of inflation “remain active in the short and medium term and could arise, in particular from the rise in international prices of basic products and energy against a backdrop of exacerbation of tensions geopolitics, water stress, and the situation of public finances above all, in the absence of mobilization of external resources.

As a reminder, the inflation rate stabilized at 7.2% (year-on-year) in May 2024 compared to 9.6% a year earlier, thanks to a relative easing of sub-par inflation. underlying “excluding fresh food products and products at administered prices” which stood at 7.3% in May, compared to 7.5% the previous month, despite the acceleration in the rate of increase in food prices. fresh food products (10.8% in May compared to 9.7% in April 2024).

The BCT further considered that “the latest available economic indicators suggest a gradual recovery in activity during the second quarter of 2024, which will be supported by the resumption of activity in the agricultural sector and the strengthening of activities in the service sector”.

It should be remembered that economic growth increased moderately by 0.2% (year-on-year) in the first quarter of 2024.

Internationally, the gradual easing of the pace of growth in consumer prices has continued in recent months, although at a relatively slow pace, the Bank estimated.

Recent international forecasts expect a slow convergence of inflation towards central bank targets, in line with upward pressures on international prices of commodities and raw materials.

“Despite a certain optimism in the markets with regard to generalized monetary easing, the prospects of stubborn inflation would continue to weigh on the direction of the monetary policy of the central banks of the main economies”, further noted the BCT.

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