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Tunisia: extremely tense situation for banks’ liquidity

The overall volume of refinancing of banks with the Central Bank of Tunisia (BCT), which has risen dramatically in recent weeks, hit new record high on January 3, 2018.

According to the daily monetary and financial indicators of the BCT, the overall volume of refinancing of banks reached Wednesday an amount of 11.81 billion dinars, its highest level historically, against 7.26 billion at the same date in 2017, up 4.55 billion dinars in one year.

On a month-to-month basis, the banks’ need increases considerably, reflecting the restrictive effect exerted by the external sector.

It should be remembered that the Central Bank has capped, since July 2017, its interventions through calls for tender to 7 billion dinars. The BCT’s intervention was supplemented by foreign exchange swaps, used as a monetary policy instrument.

The capping of the call for tenders has led to an intensive reliance by banks on the 24-hour loan facility (1.497 billion on average in November after 1.275 billion in October 2017), at a rate of 5.25%; i.e. 0.25 percentage point above the key policy rate.

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