Press Release No. : 25/2023
Date : 07 December 2023
Press Release No 25 – RBF Maintains Accommodative Monetary Policy Stance
The Reserve Bank of Fiji (RBF) Board decided to maintain the Overnight Policy Rate at 0.25 percent at its meeting on 07 December.
The Governor and Board Chairman, Mr Ariff Ali, stated that the accommodative monetary policy stance remains appropriate given the downward revision to the 2024 growth forecast. The Fijian economy has fully recovered from the pandemic, one year earlier than projected following the very promising recovery in the tourism industry and its positive flow-on effects to other sectors. Based on the recent data on tourism activity as well as consumption and investment indicators, the economy is projected to grow by 8.2 percent in 2023.
The Governor added that the financial sector continues to support domestic economic activity, with private sector credit expanding by 5.9 percent in October due to higher lending to business entities and households. Liquidity in the banking system was adequate at around $2.2 billion (05/12), keeping interest rates at historic lows.
On RBF’s twin monetary policy objectives, Mr Ali mentioned that the annual headline inflation was 5.8 percent in November as higher prices were recorded across most categories with year-end inflation projected to be around 6.0 percent. However, annual average inflation is expected to moderate to around 3.6 percent in 2024. As of 06 December, foreign reserves stood at around $3.4 billion, sufficient to cover 5.7 months of retained imports of goods and services and are projected to remain adequate over the medium term.
The Governor concluded that despite the slowdown in global growth, Fiji’s macroeconomic growth prospects are positive, and the outlook for RBF’s twin monetary policy objectives are within comfortable levels. The RBF will continue to monitor global and domestic economic developments and their implications on the current outlook and align monetary policy accordingly.
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