TIRANA (Albania), July 7 (SeeNews) – Albania’s central bank has decided to raise its key rate to 1.25% from 1% amid heightened inflationary pressures, the central bank governor said, Gent Sejko.

The central bank also raised the overnight lending facility interest rate to 2.25% from 1.9%, as well as the overnight deposit facility rate to 0.25% from 0.1%, Sejko said in a statement Wednesday.

“The normalization of monetary policy will create more adequate conditions to preserve price stability and allow inflation to return to the medium-term objective. At the same time, this normalization will not jeopardize the conditions for medium-term economic growth,” Sejko said.

Consumer price inflation in Albania reached 6.7% in May, mainly due to rising global energy and food prices. The central bank expects inflation to peak in the third quarter of the year and return to its target in the first half of 2024, the statement said.

The central bank raised its key rate to 1% from 0.5% in March, amid higher inflation expectations. The interest rate on the overnight lending facility was also revised – to 1.9% from 0.9%.