(Adds statement and background)
TUNIS, Feb 1 (Reuters) - Tunisia's central bank held its
key interest rate unchanged at 8% and warned the government
against using internal financing to to cover the budget deficit.
Tunisia is suffering its worst financial crisis that has led
to a shortage of basic food items and is seeking a $1.9 billion
loan from the International Monetary Fund in exchange for
unpopular reforms, including cutting food and energy subsidies.
In December, the bank raised the key interest rate by 75
basis points to 8% to combat high inflation, marking its third
rate hike last year.
The North African country's inflation rate jumped to 10.1%
in December from 9.8% in November.
The bank's statement said the current account deficit
widened in 2022 to 8.6% of GDP, compared with 6% a year earlier.
"In the absence of the capacity to mobilize external
resources, the financing of the budget through increased
recourse to indebtedness on the internal market, during the
first quarter of 2023, risks exacerbating the pressures on
liquidity that could disrupt the activity of the banking,
financial and insurance markets," the central bank said in a
statement.
Last week, Moody's ratings agency downgraded Tunisia's
debt, saying it would likely default on sovereign loans.
After reaching a staff-level agreement, the IMF
postponed its board meeting on Tunisia's loan program that was
scheduled for Dec. 19 due to the delay in implementing economic
reforms.
(Reporting by Tarek Amara
Editing by Mark Heinrich and Deepa Babington)
