MEFD December 2015

Published: Wednesday February 3rd, 2016

Preliminary indicators suggest that the mild growth in the domestic economy was maintained during the month of December, mainly reflecting modest gains in tourism sector output, while foreign investment projects continued to support construction activity. Although an improvement from the previous year, employment conditions deteriorated in the six months to November, owing to the retrenchment of workers from the Baha Mar project and return of previously discouraged workers to job search activity. Inflationary pressures remained well contained, due to the sharp falloff in global oil prices. Buoyed by net inflows from the Value Added Tax (VAT), the fiscal deficit contracted over the first five months of FY2015/16, while monetary sector developments in December were dominated by the receipt of proceeds from Government’s external loan, which supported the modest gain in external reserves, although a reduction in commercial banks’ Treasury bill holdings led to a decline in broad liquidity.

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