Central Bank of Tunisia Maintains Monetary Policy
The Central Bank of Tunisia (BCT) has decided not to modify its monetary policy. At its meeting on July 29, 2026, the Board of Directors chose to maintain the benchmark interest rate at 7%, considering that inflation risks remain high enough to warrant a cautious approach.
Inflation Continues to Slow Down
In June 2026, the inflation rate decreased to 5.3%, down from higher levels in previous months. This decline is mainly attributed to the slowdown in the rise of fresh food prices, with inflation falling from 13.2% to 11.2%. However, underlying inflation, which excludes fresh food and administered prices, remained stable at 5% for the third consecutive month, indicating that price pressures persist in the economy.
External Imbalances Worsen
On the external front, the Central Bank warns of a deterioration in balances. The current account deficit widened to 4.241 billion dinars, equivalent to 2.3% of GDP, in the first half of 2026, compared to 2.844 billion dinars a year earlier. The main reason for this is the significant increase in the energy bill, which reached a record high of 8.502 billion dinars, up from 6.370 billion dinars at the end of June 2025. The BCT notes that, excluding energy imports, the current account would have shown a surplus of 2.538 billion dinars, highlighting the significant impact of energy dependence on the country's external finances.
Foreign Reserves and Debt Repayment
The institution also highlights the repayment, in July, of the 700 million euro bond that matured. Despite this significant outflow of foreign currency, foreign exchange reserves stood at 23.4 billion dinars, representing 92 days of imports as of July 28, 2026.
International Context
Internationally, the Central Bank estimates that the context remains marked by high uncertainty. Geopolitical tensions, particularly in the Middle East, continue to fuel oil price volatility. Although energy prices have recently declined, they remain above pre-conflict levels, maintaining inflation risks, especially for energy-importing countries like Tunisia.
Conclusion
In this context, the BCT considers it necessary to continue the disinflation process while preserving macroeconomic stability. It also emphasizes the need to accelerate reforms aimed at strengthening production, stimulating investment, reducing energy dependence, and improving the economy's resilience to external shocks.
