Quarterly Monetary Policy Report, 2023/I

The new information analysed in this Reports, has been, overall, better than the expectations of the Bank of Albania. Inflation declined in November and December 2022, the economic activity continued to grow in the second half of year, while the normalisation effect of monetary policy stance is appearing more complete in financial markets. These trends are expected to continue in the next quarters. The updating of forecasts reaffirms our expectations that inflation will return to the target within the first half of 2024. The fall in inflation will reflect the further reduced inflation across international markets and the cumulative consequences of monetary policy stance normalisation in Albania. The Supervisory Council in the meeting of 1 February 2023, when this Report was reviewed, decided to maintain the monetary policy stance unchanged. The Supervisory Council deems that the inflationary pressures remain high and the further normalisation of monetary policy stance in the future is necessary to guarantee the return of inflation to the target.