Interest rate unexpected decrease
25/01/2012 00:00
Linda Rama: Between Family, Work and Albania’s Future 18/08 14:30
The pessimistic economic figures published this December for the
economic growth, and the confidence indicators, have obliged the Central
Bank to lower the interest rate with 0.25%, reaching 4%, another
historical record-breaking minimum after the recent decision taken in
November.
“The international negative developments have reflected an increased insecurity of the Albanain economy, which negatively affected consumption and investment levels. This decision offers appropriate monetary conditions for the fulfillment of the midterm inflation objective. This movement increases the monetary stimulation and encourages economic activity”, declared the Governor Ardian Fullani.
The Governor added that the economy entered a vicious circle when the lowered consumption levels stopped the businesses from investing.
“The private consumption continues to reflect a hesitating behavior and money saving tendencies. The low consumer spending levels and the presence of unused capacities in economy have halted the business demand for new investments. In parallel with this, the banks have increased their cautiousness in giving loans, by encouraging a good part of the loans for investments”, Fullani declared.
In these conditions, Bank of Albania announces that they will continue to keep the interest rate in low levels even during 2012, in order to encourage economic growth, with the hope that the citizens will increase consumption and the business will increase the investments.
According to the predictions, the 90% inflation probability will fluctuate with 1 to 3% during this year, and economic stimulating behavior will continue. The governor declared that regardless the crisis, the Albanian economy has the possibility to have in 2012 a higher economic growth then during the last year.
Top Channel
