Press Release No. : 13/2024
Date : 27 June 2024
Press Release No 13 – Reserve Bank of Fiji Maintains Monetary Policy Stance
At its meeting on 27 June, the Reserve Bank of Fiji (RBF) Board kept the Overnight Policy Rate at 0.25 percent.
The Governor and Board Chairman, Mr Ariff Ali, stated that the current monetary policy stance remains supportive of the 2.8 percent growth envisaged for this year. Sectoral performance has been mixed. While visitor arrivals cumulative to May grew by 8.3 percent, more than twice the rate forecast for the whole year, resource-based sectors, except gold and electricity, have recorded weak outcomes so far into the year.
The Board Chairman added that the financial system remains stable and conducive to economic activity. Banking system liquidity is ample (26/06: $1.9b), keeping lending rates low, thereby supporting the expansion in private sector credit (May: 9.4%).
On the RBF’s twin monetary policy objectives, Mr Ali mentioned that the annual headline inflation rate slowed to 5.8 percent in May after reaching a decade-high of 7.1 percent the month prior, as prices of food & non-alcoholic beverages declined in May. Foreign reserves are adequate (27/06: $3.3b), sufficient to cover 5.3 months of retained imports of goods and services and are projected to be adequate in the medium term.
However, the outlook could be impacted by global geopolitical tensions, commodity price shocks and the current soft growth in most of Fiji’s major trading partners. Domestically, adverse weather conditions and structural and capacity constraints remain risks to the outlook.
Amid a stable medium-term outlook for inflation and foreign reserves, the Board Chairman concluded that the monetary policy stance will be maintained for now to support Fiji’s economy. The RBF will continue to assess developments and evolving risks and align monetary policy if required.
RESERVE BANK OF FIJI
For further details, please contact:-
Communications Office:
Telephone: (679) 3223 381 Email: info@rbf.gov.fj
Mr Mervin Singh – Manager Corporate Communications:
Telephone: (679) 3223 229 Email: mervin@rbf.gov.fj