RBF: Positive indicators leads to revised 2022 growth outlook
23 September, 2022, 8:03 pm
There are positive economic indicators that have led the Central Bank to revise its earlier domestic growth outlook for 2022.
The Reserve Bank of Fiji governor and chairman of the board Ariff Ali said while risks to monetary policy objectives remained from elevated global prices global prices and tighter financial conditions in major trading partner economies, the domestic growth outlook for 2022 was expected to be better than the 12.4 per cent projected earlier.
Mr Ali said this was based on data from both real and the banking sector, as well as forward bookings for flights and hotel rooms.
The RBF Board met yesterday and agreed to maintain the Overnight Policy Rate at 0.25 per cent.
According to the RBF the demand for labour is strengthening as job vacancies advertised in the year to August rose by an annual 212.4 per cent compared with a decline of 57.1 per cent in the same period a year ago.
The 15.7 per cent growth in Pay As You Earn tax collections in the same period also portrays an improvement in formal sector employment.
The RBF also noted annual gains in the year to August in partial indicators of consumer spending, such as net Value Added Tax collections, new consumption lending and vehicle registrations.
Mr Ali said the pick-up in tourism and service-related industries employment, fiscal support through the inflation mitigation assistance and strong inflow of personal remittances were expected to support consumption and broader economic activity this year.
Foreign reserves remain at a level sufficient to provide short and medium-term buffer against any adverse external pressures.
Meanwhile, as of yesterday, foreign reserves stood at $3.4 billion, adequate to cover 8.4 months of retained imports (MORI).