BoA’s low interest rates have fueled a 0.5% growth in 2016: Governor

Low interest rates have driven economic growth by half percentage point.

During his appearance at the Parliamentary Commission of Economy, Governor Gent Sejko stressed that according to the Bank of Albania calculations, in the absence of strong monetary stimulus, the Albanian economy for the past year would have increased by 0.5 percentage point less, or at about 3 %.

According to the Bank of Albania, low interest rates have stimulated the economy through increased lending, thus lowering costs for the interest rates of existing loans and boosting consumption and investment.

However, the BoA Governor acknowledged that the full transmission of monetary policy in the economy has encountered serious obstacles and the most important is the high level of non-performing loans and the high euroisation of the economy.

The Bank of Albania expects further improvement in economic growth this year, although there is no precise forecast at this point.

However, the comeback of the economy to the potential growth levels is not without risks, and the latest ones are related specifically to the tension of the political climate in Albania.

SCAN

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