Macroeconomic Forecast Tunisia

June 2007 | Macroeconomic Forecasts

With consistent and elevated growth for over a decade, we maintain our bullish view on the Tunisian economy, which should expand at a rate of 5% this year. This is only slightly lower than last year's impressive 5.4% growth, and reflects somewhat more lacklustre global growth dynamics. On the other hand, consumer price inflation has continued its descent, falling to 1.9% y-o-y in April from its peaks of over 5% y-o-y last year, while the producer price index has also decreased to 1.4% y-o-y, in line with easing oil prices. We see inflation coming in at 2.6% y-o-y this year, down from 4.5% y-o-y in 2006. The risks here, however, are that ongoing geopolitical tensions and tight supply dynamics could mean oil prices outstripping our current US$54.5/bbl (down from US$60.8/bbl last year) expectation for the OPEC basket, derailing the downward trend of inflation.

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