The Central Bank of Samoa [CBS] has revealed that Samoa experienced a steady rise for inflation in the past 15 months peaking at 11.3 per cent in November 2022.
However, the inflation rate dropped to 11 per cent in December 2022.
This was highlighted in a statement on “The Central Bank Of Samoa Continues Its Accommodative Monetary Policy Stance For The Rest Of FY2022/2023.”
According to the statement, imported (prices) inflation has started to ease so far given the aggressive monetary tightening by advanced economies around the world, however domestic inflation is rising steadily and yet to peak.
Furthermore, inflation is starting to recede gradually from January 2023 onwards and would be at around 10 per cent by June 2023. The strong and comfortable level of our international reserves also supports this easing of the monetary policy stance.
“All in all, inflation is expected to drop to around 10 per cent by June 2023 and continue to slow down for the remainder of 2023,” states CBS.
“At its Meeting on the 3rd of March 2023, the Central Bank Board approved the continuation of its loosening monetary policy stance for the rest of the financial year 2022/2023.
“Despite the expected level of inflation staying above the 3 per cent inflation target, the CBS Board felt that monetary policy should remain eased to support and ensure economic recovery is fully realised and entrenched, after a long period of depression.”
In addition, the statement revealed that Samoa’s latest National Accounts figures showed that the economy recorded a 4.7 per cent rebound in September 2022 quarter in line with the reopening of international borders.
“Latest monthly economic indicators such as remittances, exports and visitor earnings point to a similar or even higher growth for the December 2022 quarter.
“Coupled with the expansionary fiscal policy approved by Parliament for FY2022/23 and the strong pickup in business activity so far, real GDP is expected to expand by around 3 per cent for the whole year 2022/2023.
“All in all, total foreign reserves are expected to improve by around $35.0 million to a total of $842.90 million by June 2023 or around 9.4 months of imports in FY 2022/23.”
Photo credit: Adel Fruean Caption: Apia town area.