MEFD October 2012

Published: Thursday December 13th, 2012

Domestic economic activity continued to benefit from mildly positive developments in the tourism and construction sectors; however, the narrow base limited improvements in general employment conditions and the debt profile of the private sector. Price developments remained relatively benign over the twelve-months to August, while the fiscal situation moved further into deficit during the first quarter of FY2012/13, as capital spending-led growth in total expenditure outpaced gains in aggregate revenue. In the monetary sector, bank liquidity contracted in October, in line with seasonal increases in demand for foreign exchange and other current payments, which correspondingly led to a contraction in external reserves.