Tunisia plans central-bank loan to plug fiscal gap: Domestic monetisation raises credit and FX risks

Reports indicate Tunisia intends to seek a large exceptional loan from its central bank to cover budget gaps in 2026, with IMF talks stalled. The financing route shifts material borrowing into domestic monetary accommodation rather than external market or programme financing. An exceptional central-bank loan increases inflation and liquidity risk and weakens external credibility, which transmits to Tunisian sovereign Eurobonds via higher sovereign-risk premia and reduced investor appetite for new external issuance. Domestic monetisation can prompt a depreciation path that raises the local-currency cost of servicing any remaining USD liabilities and could accelerate reserve depletion as authorities use reserves to stabilise the FX market. Regional investors will price Tunisian paper at a higher refinancing premium across both the short and medium part of the curve; yields in the belly and long end of the Eurocurve are likely to rerate as term-premium and sovereign-risk narratives shift.

Tunisia's choice contrasts with peers that retain IMF engagement or external market access; countries with active programmes or ample reserves (e. g. , Morocco or Egypt where external financing is more diversified) face relatively less immediate yield-pressure from domestic monetisation. The desk will watch whether the central-bank loan is accompanied by a credible fiscal adjustment plan or renewed IMF engagement — absent those, expect progressive spread widening and FX pressure that feeds back into domestic yields and reserve metrics.