Wednesday, November 26, 2014

Albania cuts rate another 25 bps to 2.25%

    Albania's central bank cut its policy rate by another 25 basis points to 2.25 percent following a review of the outlook and economic and monetary developments, the bank said in a brief statement.
    The Bank of Albania has now cut its rate by 75 basis points this year.
    Last month the central bank held its rate steady but said it would ease further if the economy deteriorated more than forecast.
    On Tuesday the International Monetary Fund said Albania's economy was expected to growth 2 percent this year with output below potential and inflation expected to remain low. In 2013 Albania's economy expanded by only 0.4 percent when the central bank cut rates by 100 basis points.
   The IMF also said inflation expectations appeared to be well-anchored and monetary policy should continue to be supportive of economic recovery as credit growth remains low, though recovering, due to high non-performing loans weaknesses in contract enforcement.
    Albania's headline inflation rate eased to 1.4 percent in October from 1.5 percent the previous month while Gross Domestic Product expanded by 0.38 percent in the second quarter from the first for annual growth of 1.73 percent, up from a contraction of 1.31 percent in the first quarter.


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