Albanian central bank keeps key rate unchanged at 4% after July cut.

By bne IntelliNews August 29, 2012
The supervisory board of Albanias central bank decided on August 28 to keep the base interest rate unchanged at the historic low of 4% after cutting it by 25bps in July, the bank said on its website. The board has estimated the monetary policy is appropriate to meet the medium-term inflation target, while providing stimulus to economic activity and domestic demand. Based on an analysis of the macroeconomic indicators, the central bank confirmed its projection for slow growth of the local economy in the coming period. Domestic demand will remain weak as investments and private consumption are not expected to recover, reflecting the cautious consumer behaviour and the increasing propensity to save. Albanias consumer prices grew 1.7% y/y on average in January to July 2012, slowing down from the 4% y/y increase recorded a year earlier. Inflation is projected to fluctuate within the range of 1% to 3.3% in the next twelve months.
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