The recent natural disasters are expected to raise prices of agricultural market items, says the Reserve Bank in its latest economic review.

However, it says the price increase is anticipated to generally subside within the year when supply normalizes.

Nonetheless, given the devastation in Kadavu, kava supply is expected to be affected and this will potentially raise prices in the coming months.

The RBF says inflation edged-up slightly to 2.6 percent last month, from 2.3 percent in February, but remained lower than the 5.6 percent registered a year ago.

The Central Bank says the economy is envisaged to grow for the ninth consecutive year, albeit at a slightly slower pace due to the recent spate of natural disasters.

Visitor arrivals noted an annual growth of 5.1 percent cumulative to March, driven by higher tourist numbers from New Zealand, US, Australia, China and Continental Europe.

Investment activity is expected to remain firm and forecasted to be around 28 percent of GDP.

However, last month investment activity was somewhat subdued.

In the same period, lending for investment purposes also declined by 23.3 percent largely due to base-related effects.

The RBF says nonetheless, construction and investment related activities are expected to gain momentum as a result of post disaster rehabilitation as well as the ongoing private sector projects.