TUNIS  - Tunisia's central bank kept its key interest rate unchanged at 6.75 percent on Thursday, a month after the International Monetary Fund (IMF) urged it to hike borrowing costs to tackle record inflation.

The bank expects inflation to be 7.8 percent this year and fall to 7 percent next year.

It last raised interest rates, by 100 basis points, in June, which was the second hike in three months.

Tunisia has been praised as the only democratic success among the nations where 'Arab Spring' revolts took place in 2011. But successive governments have failed to trim its fiscal deficit and create economic growth.

(Reporting By Tarek Amara; editing by John Stonestreet) ((tarek.amara@thomsonreuters.com;))