International Monetary Fund (IMF) has called on Tunisia to tighten its monetary policy in order to meet the standard inflation levels, which have stabilized since August at 7.5 percent, unchanged from July's levels, but higher than June’s levels at 7.8 percent.
Central Bank of Tunisia expects the inflation rate to reach 7.8% this year and fall back down to 7% next year.
International Monetary Fund (IMF) announced that deeper monetary tightening would reduce inflation, whereas the Tunisian central bank showed its commitment to price stability through raising interest rates, while key interest rates remained negative in real terms.
According to the IMF, the interest rate should be raised further to avoid further erosion of the purchasing power in local currency and to curb inflation expectations, noting that rise of interest rates is not acceptable in Tunisia. The Tunisian Union for Industry, Trade and Handicraft Federation, denoted that it negatively affects the competitiveness of companies and impede the investment necessary to provide jobs. In contrast, the Tunisian General Union of Labor (UGTT) considered that the increase in interest deepens the economic crisis in Tunisia and worsens the purchasing power.
Source: (Al-Arabiya.net, Edited)
