Suva: Fiji’s foreign reserves have reached $1.522billion, the highest that Fiji has reached.
According to the latest review provided by the Reserve Bank of Fiji (RBF) this level of foreign reserve is sufficient to cover 4.5 months of imports of goods and non-factor services.
“Foreign reserves rose further to $1, 522 million as at 28 June,” said the RBF Governor, Mr Barry Whiteside.
“The higher foreign reserves level provides an adequate buffer for preserving Fiji’s external stability, in the event of a sharp rise in imports particularly through higher oil
and food prices.
“The comfortable level of reserves has also enabled the RBF to approve all outstanding profit repatriation by commercial banks, as well as raise the limit for offshore investment by the Fiji National Provident Fund.”
Mr Whiteside said with the comfortable outlook for foreign reserves and inflation expected to gradually decline in the near term, it was appropriate the monetary policy stance remained accommodative to support expansion in investment, business and consumption activity.
In this regard, “the RBF has raised its concerns with individual banks and collectively with the Association of Banks in Fiji (ABIF), on the high average new lending rates and the low volume of new lending at a time when the liquidity in the banking system is at a historical high level”.
The RBF informed banks at its joint ABIF meeting that it would put in place policies that would support lending to priority sectors and measures that would bring down lending rates in a high liquidity environment.
“Further discussions will be held with the banks in July, prior to implementing these policies, which will support priority sectors of the economy, and help create employment and growth in the country,” Mr Whiteside added.
The RBF will continue to monitor developments closely over the ensuing months, along with all other factors having a bearing on economic conditions.