Increase in food prices, inflation rise by 2.0pc – Fiji Times

A 6.9 per cent in food prices and a 36.5 per cent average growth in domestic fuel prices resulted in a positive inflation rate in August after hovering in negative territory for most of the past 20 months.

As per the forecast from the Reserve Bank of Fiji, the year-end inflation is expected to increase to 2.0 per cent.

The RBF Governor and board chairman Ariff Ali said the recent opening of borders within Viti Levu and the planned resumption of international travel later this year should augur well for the Fijian economy in the last quarter of 2021.

He said the latest sectoral data revealed better annual performances for the resource-based sectors, particularly timber, gold, and mineral water production, while COVID-19 related disruptions continue to impact both the services and industrial sectors.

In a statement yesterday Mr Ali said financial conditions remained accommodative with liquidity levels at $1.6 billion with foreign reserves at comfortable levels at around $3.2b which was sufficient to cover 11.0 months of retained imports.

According to the RBF the comfortable level of foreign reserves with the quantitative easing measures of the RBF including through the Disaster Rehabilitation and Containment Facility, would ensure that liquidity remains ample and supportive of a low-interest rate environment in the near term.

Commercial banks lending rates and cost of funds have broadly declined since the beginning of the year.

Mr Ali said they agreed to maintain the Overnight Policy Rate at 0.25 per, adding that the RBF would continue to monitor global and domestic economic developments and align monetary policy as and when required.

Continued here:

Increase in food prices, inflation rise by 2.0pc - Fiji Times