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The Reserve Bank of Fiji said that in July, a total of 98,332 tourists came to Fiji, setting a record high for a single month, bringing the total number of tourists for the whole year to 545,487, 6.7% higher than the same period in 2023.
From the perspective of total demand, consumption remains positive, supported by strong tourism activities, rising income levels and remittance inflows.
Likewise, the latest segment and leading investment indicators also suggest that investment activity is gradually picking up.
On the aggregate demand side, consumption remained positive, driven by strong tourism activity, higher income levels and remittance inflows. Similarly, the latest investment component and leading indicators point to a gradual pick-up in activity.
Financial conditions remain supportive of growth, with liquidity in the banking system at $2.2 billion (August 28) and lending rates close to historic lows.
Commercial bank lending continued to accelerate, leading to an 11.6% increase in private sector credit in July.
The annual headline inflation rate reached its second peak in 2024 at 6.8% in July, driven mainly by food and non-alcoholic beverages, alcoholic beverages, tobacco and narcotics, transport, and housing and utilities.
Inflation is expected to decline to around 4.0% to 5.0% by the end of the year as the impact of the VAT increase in 2023 begins to wane. Foreign exchange reserves, at around $3.7 billion (29/08), are sufficient to cover 6.0 months of retained imports of goods and services and are expected to remain adequate over the medium term.
The Reserve Bank of Australia will continue to monitor incoming information and its implications for the current outlook and adjust monetary policy accordingly.
In addition, the Reserve Bank of Fiji board kept the overnight policy rate unchanged at 0.25% at its August meeting.
Domestic economic activity showed some signs of momentum, notably stronger-than-expected tourist arrivals and a recent improvement in industry production.
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