TIRANA, Aug 13 /ATA/- Based on Bank of Albania projections , inflation will remain at the level of 1.9% during 2020 and will gradually increase towards its target by 2022.
In the report published today on monetary policy in the second quarter of the year, the BoA states that, due to the situation created by the pandemic, inflationary pressures are expected to be low in the short run, influenced by weak demand and low level of prices in the external environment.
But the BoA emphasizes, “in the medium term, the increase in aggregate demand (credit and financial liquidity) is expected to be accompanied by an increase in employment, wages and production costs.”
Inflation rate has been rising in the second quarter. The average inflation of the second quarter was 1.9% from 1.6% in the previous quarter.
Its increase is mostly attributed to the increase in food prices, which account for about 41% of the consumer basket.
The factors that have influenced this performance are the bottlenecks in the trade chain, due to the restriction on movements, and the increase of food prices in the partner markets. With the easing of precautionary measures, the downward pressures on the demand side are expected to become more evident “- the Bank of Albania emphasizes in its report.
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