Tunisia's central bank maintained its key interest rates, noting the stabilization of inflation following the easing of some prices of foods and services amid slow economic growth.

Tunisia's leasing sector is likely to contract further due to tough refinancing conditions in the local bond market and tight banking sector liquidity, Fitch Ratings says. We expect the funding squeeze to continue as conditions in the bond and bank lending markets are unlikely to ease given Tunisia's tepid economic growth and challenging political environment, with a presidential election in November.

Fitch Ratings has assigned Tunisia's new EUR700 million 6.375% notes maturing in July 2026 a final rating of 'B+'. This replaces the expected rating of 'B+(EXP)' that Fitch assigned on 1 July 2019.

Tunisia's central bank raised its key interest rate by another 100 basis points to 7.75 percent, saying continued inflationary pressures require "appropriate measures" to reduce the negative effects from inflation to the economy and the threat to purchasing power.