Tunisia's 5.5 percent inflation rate masks a continuing rise in the cost of living, analysts warn

Tunisia's annual inflation rate held at 5.5 percent in May 2026, unchanged from April, according to Consumer Price Index data published on Friday 6 June by the National Institute of Statistics (INS). Analysts say the headline figure flatters the underlying picture.

The CPI itself continued to climb, rising from 194.8 points in April to 195.5 points in May, according to INS data cited by La Presse de Tunisie. Larbi Ben Bouhali, an economist specialising in asset management, said the stable rate did not mean prices had stopped rising — it meant they were rising at a pace similar to the preceding months. He added that the general price level now stands around 95.5 percent above the 2015 base year, reflecting a substantial cumulative erosion of household purchasing power over the past decade.

Economist Ridha Chkoundali pointed to a more troubling trend: since January 2026, when the index stood at 4.8 percent, inflation has moved higher every month. That trajectory is the reverse of 2025, when inflation fell from 6 percent in January to 5.4 percent by May.

Food prices lead the pressure

Food and non-alcoholic beverages, which account for about 26 percent of the household consumption basket, maintained an annual increase of 8.2 percent in May. The sharpest rises were in lamb meat, up 21.8 percent on the year, poultry up 15.6 percent, beef up 14.1 percent, fresh vegetables up 12.2 percent, fresh fish up 11.9 percent and fresh fruit up 11.6 percent.

Clothing and footwear recorded the highest year-on-year increase of any single category at 9.1 percent, easing slightly from 9.3 percent in April. Restaurants and hotels rose 6.3 percent, up from 6.2 percent the previous month. On the month, the CPI rose 0.3 percent, driven mainly by a 0.4 percent rise in food prices — led by a 4.2 percent increase in meat prices — and a 0.6 percent rise in the restaurants and hotels group.

A structural gap between regulated and unregulated prices deepened the picture. Prices of market-priced products rose 6.7 percent on the year, while prices of regulated products increased just 1.2 percent. Within food, unregulated items climbed 9.3 percent against 0.2 percent for price-controlled goods. A handful of products moved in the opposite direction: cooking oils fell 6.1 percent and eggs dropped 4.6 percent.

Core inflation and purchasing power

Core inflation, which strips out food and energy, held at 4.8 percent in May, indicating that price pressures have spread beyond volatile agricultural and fuel categories into the broader economy. Housing and utilities rose 4.2 percent year-on-year, and transport was up 2.3 percent.

Ben Bouhali estimated that a nominal wage increase of around 5 percent in 2026 translates to roughly 3.5 percent in real post-tax terms, leaving households with a purchasing-power loss of around minus 2 percent against a 5.5 percent inflation rate.

Central bank holds, risks mount

The Banque Centrale de Tunisie (BCT) held its policy rate at 7 percent at its board meeting on 3 June 2026, citing persistent inflationary risks from the international environment. The BCT said external inflationary pressures had recently intensified and that their transmission to domestic prices represented an upside risk for the months ahead. It added it remained ready to adjust policy if the inflation outlook required.

Chkoundali flagged a potential triple shock in the second half of 2026: higher oil prices, costlier fertilisers, and rising global cereal and feed prices. He noted Tunisia's dependence on ammonia imports routed through the Strait of Hormuz as a specific vulnerability for agricultural costs. Without a recovery in domestic production and investment, he warned, inflation risked becoming entrenched above 5 percent.

Tunisia's GDP grew 2.6 percent year-on-year in the first quarter of 2026, according to BCT data, while the current-account deficit narrowed to 2,731 million dinars — 1.5 percent of GDP — by end-April 2026, down from 2,957 million dinars a year earlier. The peak annual inflation rate reached 10.4 percent in early 2023.