Tunis - The Executive Board of the Central Bank of Tunisia, meeting on Wednesday, decided to keep its key interest rate at 7.50%.

Indeed, the Board reviewed the recent evolution of the economic and financial situation both internationally and nationally, as well as the evolution of inflation, which, despite the recent easing, still remains at a level above 5%, according to a press release published by the BCT.

According to the BCT, the international environment continues to face unprecedented financial and economic risks, driven by trade and geopolitical tensions.

These tensions will continue to weigh on the growth prospects of major economies and will exacerbate uncertainty regarding the evolution of international prices of basic commodities and inflation.

The room for maneuver of central banks to continue monetary easing has recently narrowed considerably, giving way to caution regarding interest rate adjustments.

At the national level, the BCT stressed that “the available short-term indicators suggest a gradual recovery of growth after a slight slowdown during the first quarter of 2025.

This strengthening should be supported by the recovery of activity in key export-oriented industries and the dynamism of domestic demand. In fact, import flows remained on a sustained upward trend during the second quarter of 2025, particularly imports of raw materials and semi-finished products.”

In terms of the external sector, the trade deficit (FOB-CIF) stood at 9,900 million dinars at the end of the first half of 2025, compared to 8,017 million dinars a year earlier, resulting in a widening of the current account deficit, which reached 3,399 million dinars (or 1.9% of GDP) by the end of June 2025, compared to 1,964 million dinars (or 1.2% of GDP) a year earlier.

The widening of the current account deficit was relatively mitigated by the solid performance of workers’ remittances and tourism revenues.

Net foreign exchange reserves continue to show resilience. They stood at 23.2 billion dinars (or 101 days of imports) as of July 29, 2025, compared to 24.4 billion a year earlier.

For its part, the exchange rate of the Dinar continues to perform well against the main foreign currencies, which should support the easing of inflation.

With regard to consumer prices, “the easing of tensions stemming from external factors affecting price formation, combined with the transmission of previous monetary policy actions, has supported the continuation of the gradual disinflation process during the first half of 2025.”

The inflation rate stabilised at 5.4% in June 2025, compared to 6.2% at the end of 2024. This easing was particularly marked in the core inflation measure, excluding fresh food prices and regulated prices, which stood at 4.7% in May–June 2025, compared to 5.2% in December 2024.

The slowdown in the inflation of administered products continued, against a backdrop of maintained price freezes for most items, with the rate evolving to 1.5% in June 2025 compared to 3.8% at the end of 2024.

Conversely, limited supply conditions continued to fuel pressures on the inflation of fresh food products, which remained high at 13.6% in June 2025 compared to 12.6% at the end of 2024 and a historical average of 5%.

The BCT considers that recent forecasts point to a continued gradual downward trend in inflation during the second half of 2025, with an average rate of 5.3% for the whole year, compared to 7% in 2024.

However, stronger and more persistent inflationary pressures than expected, resulting from the evolution of international prices of key basic commodities and raw materials, could drive inflation upward.

The Board considers that the upward risks weighing on the inflation trajectory remain active and that it is necessary to continue supporting the ongoing disinflation process and to bring inflation back to its long-term average.

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