THE Reserve Bank of Fiji board at its monthly meeting last week agreed to maintain the Overnight Policy Rate (OPR) at 0.5 per cent.
Governor Barry Whiteside said with the re-emergence of fiscal and banking sector vulnerabilities in Europe, the external environment was expected to remain fragile and continued to pose downside risks to Fiji's growth prospects.
Domestically, he said in a statement, sectoral performances and consumption related activity in the first half of the year have, however, been generally positive, despite the early setback of two damaging floods in January and late March.
Economic activity in the second half of the year is expected to be supported by recent developments in the mining and forestry sectors, new public infrastructure projects, the commencement of sugar harvesting and onset of the peak tourism season, as well as the continuation of growth in consumption related activities.
The economy is forecast to expand by 2.7 per cent this year following an estimated 2.0 per cent expansion in 2011.