The Reserve Bank of Fiji says the build-up in non-performing loans could impact financial stability moving ahead.[Source: architectspacific]

The Reserve Bank of Fiji says the build-up in non-performing loans could impact financial stability moving ahead.

RBF Governor Ariff Ali says the economy is operating well below potential with ongoing weakness in the labour market as a result of job losses and reduced hours.

The RBF says credit growth decelerated further last month with low lending rates to the private sector, however, there is high liquidity of around $786.1 million as of yesterday.

Annual inflation came in negative for the ninth consecutive month and reached a historic low of -3.5 percent last month.

Ali says the halt in global travel has brought Fiji’s important tourism sector to a standstill and negatively impacted the broader economy.

The Reserve Bank also recognizes that the increased budgetary allocations are expected to positively nudge consumer and business confidence and stimulate domestic demand.

Foreign reserves are currently just over $2.1 Billion as of today, sufficient to cover 7.7 months of retained imports of goods and services.