An official announcement by the Bank of Albania declared that the increase of the Albanian economy by 2% during 2015, as predicted by the government, will be influenced by many external factors. The achievement of this objective depends on the performance of the global economy and that of exports.
In the declaration of the monetary policy, the Bank of Albania states: “The domestic demand is not a sufficient actor in exploiting all producing capacities of the country’s economy. The weakness of the labor market and low inflationist expectations do not promise much about the increase of wages and production costs.”
The inflation indicator reached at 1.4% in October, being a at a lower level than the minimal objective of 2% predicted by Bank of Albania, and for that this institution decreased the interest rate at 2.25%, in attempt to stimulate the economy. The effectiveness of this initiative will be seen at how the bank system will perform in the upcoming months. Inflation shows indirectly that the level costs in the country continue to remain at low levels as a consequence of the low domestic consume during the entire year. Bank of Albania will decrease the interest loans in order to encourage the lending of second tier banks.
News source: Balkan Web
Photo credits: sodaro,k (Flickr)
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