$2.4 billion liquidity in the banking system
4 October, 2023, 6:23 am
Liquidity levels in the banking system remained adequate at $2.4 billion as at September, keeping interest rates low.
The Reserve Bank of Fiji noted that the sufficient banking system liquidity and persistently low-interest-rate environment are expected to support growth in private-sector credit and drive economic activity in the months ahead.
Foreign reserves also remain comfortable at $3.6b — sufficient to cover 6.3 months of retained imports as of 29 September, and is anticipated to remain adequate in the medium term.
The tourism sector also performed exceptionally well with earnings from the industry surpassing the billion dollar mark – an increase of 125 per cent from the previous year and 12.3 per cent higher than pre-pandemic earnings, largely due to the growth in visitor arrivals and higher spending levels.
However the RBF also cautioned that on the domestic front, risks to the outlook were in the form of introduced changes to the corporate tax and VAT rates, the continued migration of skilled workers, and the impact of climate change.
It said in addition, addressing the tourism industry’s current capacity constraints, and prioritising private sector investment is crucial for sustainable growth.