• Mon. Mar 20th, 2023

Central bank of Bahamas says domestic economy recovery maintained momentum


Mar 16, 2023

The Central Bank of The Bahamas (CBB) on Wednesday pointed out the domestic economy maintained its recovery momentum all through the fourth quarter of final year, from the adverse effects of the coronavirus (COVID-19) pandemic.

In the Quarterly Monetary Assessment supplying an examination of the domestic economy’s efficiency, as appropriately as sectoral developments, principally all through the period October to December, the CBB pointed out tourism output continued to record robust improvement.

It pointed out such improvement was undergirded by wholesome gains in the larger worth-added air segment and the rebound in sea targeted website traffic, reflective of the relaxed pandemic restrictions and pent-up demand for travel in the important provide markets.

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“In addition, foreign investment projects, and to a lesser extent post-hurricane reconstruction execute, continued to provide excellent impulses to the creating sector. In worth developments, domestic inflation remained elevated extra than the critique quarter, reflective of the pass-by suggests of effects of bigger international oil expenses and enhanced charges for imported goods,” the CBB pointed out.

It pointed out preliminary estimates revealed that all through the second quarter of the monetary year 2022/23, the government’s basic deficit widened, relative to the comparative quarter of the monetary year 2021/22.

“Underlying this outturn, spending recovery paced faster than the worth-added tax (VAT)led improvement in earnings, buoyed by enhancing economic conditions. Budgetary financing was mainly obtained from internal sources and a drawdown in International Monetary Fund (IMF) Certain Drawing Rights (SDRs).”

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The CBB pointed out that monetary developments featured a contraction in bank liquidity, as the expansion in domestic credit, contrasted with the reduction in the deposit base. Correspondingly, external reserves declined, attributed to the seasonal enhance in demand for foreign currency and the conversion of the IMF SDR allocations.

“Further, banks’ credit best high quality indicators enhanced all through the critique quarter, underpinned by the sustained strengthening in the domestic economy and ongoing loan build-offs. In addition, the most current info for the third quarter indicated a rise in banks’ basic net earnings, led by a minimize in terrible debt provisioning.”

In the external sector, the CBB pointed out the estimated present account deficit narrowed all through the critique quarter, due to a marked enhance in the options account surplus, bolstered by ongoing gains in tourism earnings.

In contrast, the monetary account balance switched to a net outflow, vis-à-vis an inflow in 2021, owing mainly to a reversal in other investment transactions to an outflow from an inflow a year earlier and a surge in portfolio investment outflows, linked with residents’ obtain of Government’s external bonds, the CBB pointed out.



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