Saturday, May 18, 2024
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Inflation to rise, due to tax increases in budget

The Reserve Bank of Fiji says given the recently announced tax increases in the 2023-2024 National Budget, inflation is expected to rise from August onwards.

At the same time, register at 4.7 per cent at the end of the year before subsiding to 2.5 per cent by the end of 2024.

Reserve Bank of Fiji Governor and Chairman of the RBF Board, Ariff Ali says headline inflation has been on a declining trend and moderated to 0.8 per cent in May from the 1.4 per cent recorded in April, mostly owing to lower fuel and kava prices.

Ali said that, however, inflation will rise based on the tax increases from August.

“Foreign reserves remain comfortable at $3.6 billion, sufficient to cover 6.3 months of retained imports of goods and services, and the medium term outlook is above the benchmark of 4.0 months of import cover.”

The RBF Governor said the current monetary policy stance will continue as long as the outlook for inflation and foreign reserves are within the comfortable range.

Ali said the RBF will continue to closely monitor global and domestic economic developments, and align monetary policy accordingly.

The board has also decided to maintain the Overnight Policy Rate at 0.25 per cent.

Ilaitia Ravuwai
Ilaitia Ravuwai
Journalist | news@fijilive.com

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