Bank of Albania Holds Interest Rate at 5.25%

The Bank of Albania held its main monetary policy interest rate unchanged at 5.25%, noting monetary conditions will likely see inflation return to target in the medium term.  The Bank noted that: "inflation will continue to be under the pressure of foreign prices in the coming period,"..."but, barring unexpected developments, the effect of the shocks of foreign prices will wane while the effect of administered prices will cease in the third quarter".

The Bank of Albania previously raised the interest rate by 25 basis points to 5.25% at its March meeting this year.  Albania reported annual inflation of 4.2% in May this year, down slightly from 4.5% in February this year, but still above the Bank's 3% inflation target.  The IMF sees Albania's economy growing 2.7% this year, while the government sees 5% GDP growth; Albanian economic growth was 2.3% in 2010.

www.CentralBankNews.info