The Reserve Bank of Fiji (RBF) has decided to maintain its Overnight Policy Rate at 0.25 per cent.
Reserve Bank of Fiji Governor Ariff Ali said maintaining the OPR would support the projected 2.8% economic growth for the year.
In terms of sectoral performance, the RBF noted mixed results, with significant growth in visitor arrivals, while most resource-based sectors underperformed.
“While visitor arrivals cumulative to May grew by 8.3 per cent, more than twice the rate forecast for the whole year, resource-based sectors, except gold and electricity, have recorded weak outcomes so far into the year,” Ali said noting that the financial system remained stable with ample liquidity ($1.9 billion), supporting low lending rates and private sector credit growth (9.4% in May).
Inflation slowed to 5.8 per cent in May from 7.1 per cent in April, and foreign reserves are strong at $3.3 billion, sufficient to cover 5.3 months of retained imports of goods and services and are projected to be adequate in the medium term.
However, global geopolitical tensions, commodity price shocks, and domestic issues pose risks. The RBF stated that it will maintain its policy stance, monitoring and adjusting as needed.
