MEFD May 2011

Published: Wednesday July 6th, 2011

Domestic economic conditions maintained a positive momentum over the review period, supported by steady gains in tourism output, foreign investments in tourism related construction activity and public sector capital projects. Although domestic inflation remained relatively benign, energy costs continued to trend upwards, on account of elevated international oil prices. In the fiscal sector, the overall deficit for the ten months of FY2010/11 narrowed, as higher revenue collections offset the rise in expenditure. In monetary developments, external reserves were maintained at a very healthy level, despite a comparatively lower monthly rate of accretion, and bank liquidity was boosted by the Government’s utilisation of funds from the previous month’s privatisation transaction to reduce short-term debt obligations.

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