The Fiji Times »Rising food prices, rising inflation by 2.0 pc
A 6.9 percent food price inflation rate and an average 36.5 percent growth in domestic fuel prices resulted in a positive inflation rate in August after hovering in negative territory for most of the last 20 months.
According to forecasts by the Reserve Bank of Fiji, inflation at the end of the year is expected to rise to 2.0%.
RBF Governor and Chairman of the Board Ariff Ali said the recent border opening within Viti Levu and the expected resumption of international travel later this year should bode well for the Fijian economy in the last quarter of 2021.
He said the latest industry data showed better annual performance for resource-based sectors, especially timber, gold and mineral water production, as COVID-19-related disruptions continue to increase. have an impact on the service and industrial sectors.
In a statement released yesterday, Ali said financial conditions remained accommodative with liquidity levels at $ 1.6 billion and foreign exchange reserves at comfortable levels at around $ 3.2 billion, which was sufficient to cover 11.0 months of retained imports.
According to the RBF, the comfortable level of foreign exchange reserves with the RBF’s quantitative easing measures, including through the disaster rehabilitation and containment facility, would ensure that liquidity remains abundant and conducive to an interest rate environment. low interest in the short term.
Lending rates and the cost of funds for commercial banks have generally fallen since the start of the year.
Mr Ali said they had agreed to keep the overnight key rate at 0.25 percent, adding that the RBF would continue to monitor global and domestic economic developments and align monetary policy when needed. .