earthquake and the pandemic, gdp is expected to drop by around 7 % of gdp. the policy measures of the bank of albania were aimed at ensuring an uninterrupted flow of credit and financial services, as well as at preserving monetary and financial stability. more specifically, we : increased the monetary stimulus by lowering the policy rate to 0. 5 % in march and by switching to fixed - price full - allotment liquidity injection operations. instructed banks to offer liquidity relief to viable businesses facing temporary difficulties, in 1 / 2 bis central bankers'speeches the form of a short - term moratorium on credit installments as well as in the form of a targeted credit restructuring, and we facilitated this process with targeted and temporary regulatory actions. abolished dividend payments across the banking sector, in order to strengthen its capital. finally, we forfeited fees on the interbank transactions costs for the payment systems operated by the boa. our monetary and financial accommodation was coordinated and greatly facilitated by the fiscal stimulus. by leveraging the balance sheets of the public sector, fiscal policy compensated the loss of income for households, offered liquidity support for affected businesses in the form of delayed tax payment and improved access to finance through sovereign credit guarantees. in this regard, i would like to emphasize the role of the rfi ( rapid financing instrument ). it was one of the first reach outs to albania. it had a large impact in facilitating our fiscal stimulus, alleviating its impact in the domestic financial markets, and signaling the ability of our country to access various sources of funding. initial results of our policies have been encouraging. the albanian banking sector remains solid, solvent and liquid. our domestic financial markets are calm, while both interest and exchange rates are stable. in addition, the positive flow of credit to the economy has been instrumental in mitigating business failures and related costs. finally, both our public and the private sector have preserved access to international financial markets. first, unprecedented shocks require timely and unprecedented measures, measures which should critically question conventional thinking of economic policy. second, the complexity of the crisis requires careful policy coordination, in order to deliver targeted relief to key economic sectors. third, international cooperation – in the form of financial assistance and policy guidance – is crucial for alleviating costs to emerging economies and avoiding negative spillovers on a regional and global scale. fourth, sound monetary and financial fundamentals are the best insurance policy and investment we can make to sustainable long term growth

ardian fullani : overview of albania ’ s latest economic and financial developments speech by mr ardian fullani, governor of the bank of albania, on the monetary policy decision - making of the bank of albania ’ s supervisory council, tirana, 27 march 2013. * * * today, on 27 march 2013, the supervisory council of the bank of albania reviewed and approved the monthly monetary policy report. based on the most recent monetary and economic developments in albania, and following the discussions on their outlook, the supervisory council of the bank of albania decided to keep the key interest rate unchanged, at 3. 75 %. the council notes that there are appropriate monetary conditions to ensure the achievement of the inflation target in the medium - term period, providing, at the same time, the required monetary stimulus to boost economic activity. let me now proceed with an overview of the economic developments and key issues discussed at today ’ s meeting. * * * annual inflation was 2. 5 % in february, down by 0. 2 percentage points from january. the lower inflation was primarily driven by the falling oil price, due to the base effect of the environmental tax rise in 2012 and the falling global prices. overall, inflation continues to be determined by the rise in food prices. their inflation accounted for about 90 % of february ’ s headline inflation. other basket prices have generally been stable and making low contribution to headline inflation. in the macroeconomic aspect, the general economic and monetary conditions have contributed to keeping inflation low. aggregate demand, in particular, remains sluggish and insufficient to generate full utilisation of production capacities, hence exerting no pressures on producer prices, profit margins and, consequently, the final prices of goods and services. as we have constantly pointed out, below - potential economic growth is and will remain a key factor driving the low inflation. in parallel, global prices, liquidity situation in the albanian economy and financial markets, and economic agents ’ inflation expectations have not and are not expected to generate strong inflation pressures in the medium - term period. indirect information on the performance of the albanian economic activity in the last quarter of 2012 suggests sluggish growth. aggregate demand was primarily driven by the higher exports, while the private domestic demand provided positive, albeit low, contribution. on the other hand, public sector expenditure shrank, hence making a negative contribution to the growth of aggregate demand. there is scarce information on economic developments during the first quarter of 2013. however, the analysis of available indirect data