The Bank of Albania has announced that core inflation fell for the fourth consecutive month in June, although it remains above the central bank’s target of 3%.
According to data from the Bank of Albania, “inflation declined to 5.18%, down from 5.41% in May. Currently, core inflation is at its lowest level since March of last year. Monthly index growth also slowed further to 0.16%, down from 0.26% in May. Core inflation’s monthly increase was the lowest since October 2021”.
The Bank of Albania’s report notes that core inflation reached a historic high of 8.74% between December 2022 and January 2023, and has since followed a downward trend.
Core inflation measures changes in consumer prices, excluding those products that have high volatility due to their nature, primarily food and energy products. The aim of core inflation is to strip out the overall price growth from the effects of supply shocks or other short-term factors.
Although core inflation is falling, it remains persistently above the average inflation rate in the economy. According to data from the Institute of Statistics (INSTAT), in June, overall inflation experienced another slight decline, reaching 4.5%, the lowest since February of last year.
The Bank of Albania assures that, “in any case, monetary policy will ensure the necessary conditions for respecting the price stability objective in the medium term, while also taking care to minimize its impact on economic activity and potential undesirable consequences on financial stability”.
