The Central Bank of Tunisia (BCT) cut its key interest rate on Wednesday by 50 basis points to 6.25%, aiming to stimulate investment and push faltering growth, reads a statement of the BCT.
The decision was taken “to contribute to the creation of favourable conditions to boost investment and restore the pace of economic activity while preserving financial stability,” the same source said.
After reviewing recent economic, monetary, and financial indicators, including the latest data on economic growth, inflation, and the current account deficit, the BCT continues to closely monitor all developments, in consultation with all parties concerned.
It is the only second time the bank has lowered borrowing costs since 2011 and follows a 100 basis point rate cut in March responding to the coronavirus outbreak.
Foreign investment decreased by 14 % in the first half of this year, to 1.1 billion Tunisian dinars ($398 million).
Central bank figures showed that Tunisia’s foreign exchange reserves are now 21.12 billion dinars, equivalent to only 141 days of imports compared to 101 days of imports a year ago.