Mau­ri­tius mon­e­tary pol­icy re­mains broadly ap­pro­pri­ate: IMF

The Pak Banker - - FRONT PAGE -

The Ex­ec­u­tive Board of the In­ter­na­tional Mon­e­tary Fund (IMF) con­cluded the Ar­ti­cle IV con­sul­ta­tion with Mau­ri­tius.

Mau­ri­tius has con­tin­ued to grow at a mod­er­ate rate of 3.4 per­cent in 2015, as weak ex­ter­nal de­mand, pro­tracted de­cline in con­struc­tion, and the col­lapse of a large fi­nan­cial con­glom­er­ate group more than off­set the pos­i­tive im­pact of fa­vor­able terms of trade.

In­fla­tion re­mains low (0.4 per­cent in Jan­uary 2016), re­flect­ing in part de­clin­ing oil prices and ship­ping costs. Un­em­ploy­ment hov­ers around 8 per­cent, al­though it is higher among women and the youth. The ex­ter­nal cur­rent ac­count deficit nar­rowed to about 5 per­cent of GDP and in­ter­na­tional re­serves in­creased to 6.5 months of im­ports, sup­ported by con­tin­ued cap­i­tal in­flows.

The mon­e­tary pol­icy stance re­mains broadly ap­pro­pri­ate against the back­drop of sub­dued in­fla­tion. The Bank of Mau­ri­tius re­duced its key pol­icy rate by 25 bps in Novem­ber 2015, to 4.40 per­cent, in or­der to sup­port the do­mes­tic econ­omy, while mak­ing progress in mop­ping up ex­cess do­mes­tic cur­rency liq­uid­ity.

In the fi­nan­cial sec­tor, credit growth is grad­u­ally re­cov­er­ing and over­all, the bank­ing sys­tem re­mains well cap­i­tal­ized.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.