Tunisia's central bank has kept the key interest rate unchanged at 8%, it said on Friday, adding it was watching for any potential repercussions that may result from a government request for direct funding from the bank, Reuters reported. The government requested exceptional direct funding from the central bank worth 7 billion dinars ($2.25 billion) to fill a deficit in this year's budget, given the scarcity of external finance, three lawmakers told Reuters on Tuesday. Economists warned that the move could lead to rising inflation and weigh on the value of Tunisia's currency.
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Tunisia
Tunisia’s central bank kept its benchmark interest rate unchanged despite a pick-up in inflation, as political tensions hinder reform efforts needed to obtain a loan from the International Monetary Fund, Bloomberg News reported. Banque Central de Tunisie kept the rate at 8%, the regulator said in a statement following a board meeting Thursday. The “current stance of the monetary policy will support a further easing of inflation over the coming period,” it said.
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Tunisia's central bank held its key interest rate unchanged at 8%, it announced on Friday, saying that keeping the interest rate at the current level will continue to push inflation downward, Reuters reported. In December, the bank raised the key interest rate by 75 basis points to 8% to combat high inflation, marking its third rate hike last year. The annual inflation rate eased to 9.6% in May from 10.1% in April, and a high of 10.4% in February. "The current monetary trends would contribute to pushing down inflation rates during the coming period", the bank said in statement.
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Italy on Thursday pledged Tunisia a host of investments and help negotiating an International Monetary Fund bailout as the European nation seeks to stem the number of migrants arriving from North Africa, the Associated Press reported. Foreign Minister Antonio Tajani outlined Italy’s efforts and pledges during a meeting with his Tunisian counterpart, Nabil Ammar, who insisted that Tunisia has seen growing numbers of African migrants arriving from the Libyan border and needs economic help.
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Tunisia's government on Wednesday began discussions on a new foreign exchange bill it says will help to make international business dealings easier, following calls from Tunisian firms for reform, Reuters reported. "Tunisia looks to modernise the exchange system and to gradual liberalisation of financial relations toward a full liberalisation with the outside world," the government said on Wednesday in a statement following talks on the bill. Investors have to get central bank approval to access hard currency to fund operations abroad, or obtain credit letters to import goods.
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Tunisia expects to reach a deal with the International Monetary Fund in coming weeks on a loan of between $2 billion and $4 billion over three years, the central bank governor said on Sunday, Reuters reported. Tunisia, which is suffering its worst financial crisis, is seeking to secure an IMF loan to save public finances from collapse. "The size is still under negotiation and I think it will be between $2 billion and $4 billion, we hope to reach a staff level deal in coming weeks," Marouan Abassi told Reuters.
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A delegation from the International Monetary Fund will visit Tunisia on Monday to start negotiations over a loan programme, a central bank official told Reuters on Friday, Reuters reported. This follows the completion of technical talks between the IMF and Tunisia, said Zied Mouhli, a central bank spokesperson. Tunisia, which is facing a financial crisis, is seeking to reach a loan deal in return for an unpopular reform package to shore up its struggling public finances.
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Tunisia's government said on Tuesday it suspended the export of vegetables in an effort to control inflamed prices in the local market as a severe economic crisis hits the North African country, Reuters reported. Commerce ministry spokesperson Mohamed Ali Ferchichi said the ministry decided to stop the export of tomatoes, peppers, onions and potatoes in an effort to reduce prices. Tunisia mainly exports these vegetables to its neighbor Libya.
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Tunisia's president said on Monday there would be a national dialogue about the country's political system as he moves to rewrite the constitution after establishing one-man rule, but he gave no details on how it would take place, Reuters reported. President Kais Saied has already held an online consultation to canvas public opinion about the new constitution, and has promised to name a panel of lawyers to draft it and put it to a referendum in July.
A small team of International Monetary Fund staff will visit Tunisia later this month for further discussions about a possible IMF-supported financing program, the global lender said on Thursday, citing good progress in discussions to date, Reuters reported. IMF spokesperson Gerry Rice said the visit comes after several months of consultations with Tunisian authorities on their request for a fund-supported program. "A small staff team from the IMF plans to visit Tunisia for further discussions with the authorities later this month ...