Politics

Liquidity Falls from $360.1 Million to $329.7 Million

Liquidity measured by banks’ demand deposits averaged around $360.1 million in April. As at 29 May, liquidity was $329.7 million.

However the Reserve Bank of Fiji says the the liquidity is sufficient to support economic activity in their May Economic Review.

The Annual inflation in April stood at 2.1 percent, lower than the 4.0 percent registered in both March 2019 and April last year. Over the month, consumer prices decreased by 0.2 percent due to lower prices of food & non-alcoholic beverages; housing, water, electricity, gas & other fuels and the transport categories.

Foreign reserves (RBF holdings) rose in April to $1,943.4 million, sufficient to cover 4.2 months of retained imports (MORI) of goods and non-factor services. As at 31 May, foreign reserves were $ 1,930.9m million, sufficient to cover 4.2 months of MORI.

Taking into consideration developments in the domestic and international economy and the outlook for inflation and foreign reserves, the Reserve Bank Board left the overnight policy rate unchanged at 0.5 percent.

Meanwhile the Global Economy suffers from the US-China Trade war.

Global economic growth is expected to slow down to 3.3 percent in 2019, after expanding by 3.6 percent in 2018. Increased trade tensions between China and the United States (US), declining business confidence, tightening financial conditions and policy uncertainty in most economies remain as key downside risks to the growth outlook. Nonetheless, a slight rebound in global growth to 3.6 percent is expected for 2020.

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