Central Bank of Tunisia Maintains Key Interest Rate at 7%
The Board of Directors of the Central Bank of Tunisia (BCT) decided, during a meeting held on Wednesday, to keep its key interest rate unchanged at 7%. The Board also deemed it necessary to continue supporting the ongoing disinflation process in order to bring inflation back to its long-term average, according to a statement released by the BCT. This meeting also provided an opportunity to review the recent evolution of the economic and financial situation, both internationally and nationally, as well as the recent dynamics of inflation.
National Economic Situation
On the national level, inflation declined to 4.8% in January 2026, after stabilizing at 4.9% over the previous three months. According to the BCT, this easing was facilitated by the slowdown in inflation of administered-price products, which fell to 0.6% from 0.8% in December 2025, in a context marked by the maintenance of the freeze on most administered prices that are predominant in the consumer basket. Furthermore, the pace of fresh food price growth slowed in January 2026 to 10.3%, compared to 11.2% the previous month, thanks to an improvement in the supply of several products. In contrast, underlying inflation (excluding fresh food products and administered-price products) continued its gradual upward trend, rising from 4.3% in September 2025 to 4.9% in January 2026. This development is largely explained by the waning of the downward base effect related to the sharp contraction in domestic olive oil prices observed in 2025.
External Sector
At the level of the external sector, 2025 ended with a current account deficit of 4,350 million dinars (or -2.5% of GDP), compared to 2,576 million dinars (-1.6% of GDP) the previous year. This widening is explained by the deterioration of the trade deficit, partially offset by the improvement in labor income and tourism receipts. The gradual consolidation of foreign exchange reserves continued recently, bringing reserves to 25.8 billion dinars (or 109 days of imports) as of February 10, 2026, compared to 23.3 billion dinars (102 days of imports) a year earlier.
International Context
On the international level, inflation continued to moderate in January 2026, despite a slow recovery in the prices of major commodities and raw materials. In this context, the central banks of major economies opted for the status quo during their latest monetary policy meetings, due to uncertainties surrounding trade policies and price evolution prospects.
