THE shutdown of the US Government, attributed to Congress' inability to agree on the spending bill, is a global concern and Fiji is no exception.
RBF governor Barry Whiteside yesterday said the current turn of events in the US was a downside risk for Fiji.
He said the bank would continue to monitor the situation closely and take any necessary action to protect the island nation's growth prospects and external stability.
"If the shutdown is short-lived, then it's simply a big inconvenience for the US citizens and will not have much impact across the globe," said Mr Whiteside.
"So far, global equity and commodity markets have showed no major signs of strain on the assumption that this shutdown will be temporary.
"However, if the shutdown is prolonged, the US economy is expected to be impacted and this would more than likely include loss of jobs, including those working in government offices."
He said latest estimates by Goldman Sachs point towards a 0.9 per cent trimming of growth this quarter.
Mr Whiteside said therefore, it was in the interest of US Congress to resolve the issue as soon as possible.
"Such a downgrade when the global economy is still recovering will have impact on the growth prospects for many of our major trading partner countries and will negatively impact Fiji as well.
"The impact on the Fijian economy will be channelled through reduced demand for our exports both from the US and other economies which rely on US demand.
"Additionally, the US is an important source of remittances and tourists for Fiji."
At this stage, he said the RBF did not think it would affect this year's GDP growth or foreign reserves but it would affect next year's growth if the issue was not resolved soon.
However, Mr Whiteside said the bigger concern for the global economy, including Fiji, was the US debt limit.
"The US debt limit is expected to be reached by mid-October and if there is no agreement on raising the debt ceiling, the US would be forced to run immediate balanced budgets.
"This could lead the US economy into a recession which will have much bigger negative repercussions across the globe."