Governor Ali explains why devaluation is not an option
April 17, 2019 4:50 pm
Rumors of a devaluation of the Fijian dollar have been rife since March.
Governor of the Reserve Bank, Ariff Ali has cleared the air, refuting the rumors and explaining why devaluation is not an option now nor in the near future.
Ali says given Fiji’s track record of devaluation, the current reserves are ample to tide the economy over.
I still have a buffer of very close to $600 million apart from what I have here, so overall what I’m trying to say is that I have a buffer in excess of a billion dollars in foreign reserves, well above the three month bench mark that IMF set. Every time we have devalued, our reserves were less than two months of import cover. So if you have to think about a benchmark of two months when we have to do the devaluing, we’ve got about $1.5 billion in excess, so I’ll let you make the judgement of whether I’m crazy or not crazy to devalue that.
The Governor made the comments at the inaugural 2019 Business Summit which was organized by the Fiji Chamber of Commerce and Industry.