Thursday, August 1, 2013

Albania cuts rate 25 bps to 3.5 percent

    Albania's central bank cut its benchmark repurchase rate by 25 basis points to 3.50 percent, but it did not release any reason for the decision on July 31 by the bank's supervisory council.
    Last week the bank's governor, Ardian Fullani, said the country's economy was "in a fragile stage" with weak aggregate demand due to low consumer spending from household uncertainty about the future and slowing income. Public spending is also limited due to high public debt while exports suffer from sluggish international demand and a low degree of diversification.
    "In Bank of Albania's opinion, this situation requires pursuit of stimulating macroeconomic policies," Fullani said on July 25.
    Albania's economy expanded by an annual 1.7 percent in the first quarter, down from 1.8 percent in the fourth quarter, while inflation rose to 2.3 percent in June from 2.1 percent.
    In January the central bank cut the refi rate to 3.75 percent, saying the rate cut should help ensure that inflation meets the bank's target of 3.0 percent, plus/minus one percentage point.


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