The National Reserve Bank of Tonga’s Board, at its monthly meeting on 3rd March 2017, maintained the current monetary policy measures as outlined below to encourage the utilisation of the excess liquidity in the banking system, increase lending in order to support economic growth, and strengthen the monetary policy transmission mechanism:
- maintain the monetary policy rate at 0% (zero interest rate policy);
- maintain the minimum loans/deposit ratio of 80%;
- maintain the Statutory Reserve Deposit ratio at 10% effective in July 2017; and
- maintain the inflation reference rate at 5%.
The Governor of the Reserve Bank, Sione Ngongo Kioa, announced that the Board noted that the overall domestic economic activities, which were generally favourable, continued to support the Reserve Bank’s expectation of stronger growth for 2016/17.
The foreign reserves rose to $378.8 million by the end of December, equivalent to 9.8 months of imports cover, which is well above the Reserve Bank’s minimum range of 3-4 months, and is expected to remain comfortable. Inflation also remained high, rising by 6.7% over the year to December due mainly to the new customs duties and excise tax introduced in July 2016 and the short supply of kava and the seasonality in local produce driving the higher domestic prices. The Reserve Bank anticipates the annual headline inflation rate to be around 2% in the next financial year.
The banking system remained sound with strong capital position maintained, supported by comfortable profitability, and non-performing loans remained low. Excess liquidity remained as the continuous rise in deposits, coinciding with the higher foreign reserves, outweighed the strong credit growth. This resulted in total loans to deposit ratio declining to 74.5% in December 2016, which is below the 80% minimum target. The 17.1% annual credit growth was supported by the lower weighted average lending rate.
The Reserve Bank will continue to closely monitor developments in the domestic and global economy, and update its monetary policy setting to maintain internal and external monetary stability, and to promote a sound and efficient financial system in order to support macroeconomic stability and economic growth.
Tu’utu’uni ki he Fokotu’utu’u Ngāue Fakapa’anga
‘I he fakataha ko ia ‘a e Poate e kau Talēkita ‘a e Pangikē Pule Fakafonua ‘o Tongá, ‘i he ‘aho 3 ‘o Ma’asi 2017, na’e tali e tu’utu’uni fakapangikē ke kei hokohoko atu ai pē ‘a e ngaahi tu’utu’uni fakangāue lolotongá, ke faka’ai’ai ‘aki mo pāotoloaki ‘a e ngaahi ngāue faka’ekonōmika ‘a e fonuá. Ko e ngaahi tu’utu’uni eni:-
- Ke kei hoko atu pe hono ta’etotongi tupu ‘a e pa’anga ngāue ‘a e ngaahi pangiké (Exchange Settlement Account) ‘oku fakahū ‘i he Pangikē Pulé;
- Ke ‘oua e toe ma’ulalo hifo he pēseti ‘e 80 ‘o e lahi e ngaahi nō ‘oku tukuatu ‘ehe ngaahi pangike ‘o fakahoa ki he lahi ‘o ‘enau ngaahi fakahū pa’angá (loan/deposit ratio);
- Ke hiki hake e lahi ‘o e pa’anga ‘a e ngaahi pangiké fakakomesiale, ‘oku tu’utu’uni fakalao ke tauhi ‘i he Pangikē Pulé (Statutory Reserve Deposit) ‘i he pēseti ‘e 10 ‘o kamata ‘i Siulai 2017; pea
- Ke tu’uma’u pē ‘a e fakaámu ki he hikihiki e totongi ‘o e ngaahi koloá ‘i he pēseti ‘e 5 ‘i he ta’u.
Na’e fakahā ‘e he Kōvana ‘o e Pangikē Pulé, Sione Ngongo Kioa, na’a nau vakai ai ki he lelei ange ‘a e ngaahi ngāue faka’ekonōmika fakalotofonuá ‘o tokoni ia ki he fakafuofua ‘a e Pangikē Pulé ‘e mālohi e tupu ‘a e tu’unga faka’ekonōmika ‘i he 2016/17. Na’e kake ‘a e pa’anga talifaki ‘i mulí (foreign reserves) ki he $378.8 ‘i he faka’osinga ‘o Tīsemá pea ‘oku fakafuofua ‘e kei ‘i he tu’unga fakafiemālie ai pē.
‘Oku fe’unga ‘a e tu’unga ‘o e pa’anga talifakí pea mo e māhina ‘e 9.8 ‘o e koloa hū mai mei mulí (imports), ‘a ia oku kei mā’olunga ‘aupito ange eni ‘i he tu’unga fe’unga ‘oku fiema’u ‘e he Pangikē Pulé, ‘a ia ko e māhina ‘e 3 ki he 4 ‘o e koloa hū mai mei mulí. ‘Oku kei mā’olunga pē mo e hikihiki ‘o e totongi koloa fakata’ú, ‘a ia ne hiki ‘aki e peseti ‘e 6.7 ‘i he faka’osinga ‘o e ta’ú ki Tīsemá. ‘Oku makatu’unga eni mei he ngaahi totongi tute fo’ou ne fakahoko ‘i Siulai 2016, si’isi’i ange ‘a e lahi ‘o e kava-Tongá ‘i he māketí (supply shortage) pea mo e fetōkaki ‘i he lahi ‘o e ngaahi koloa fakalotofonuá ‘i he maketí (supply), ‘a ia ‘oku ne fakatupunga ‘a e kake ‘i he totongi koloa fakalotofonuá. ‘Oku fakafuofua ‘e he Pangikē Pulé, ‘e toki holo ‘a e hikihiki fakata’u ki he totongi fakalukufua ‘o e koloá ki he ‘avalisi ko e peseti ‘e 2 ‘i he ta’u fakapa’anga ka hokó.
Na’e kei mālohi mo fai fatongia lelei pē ‘a e ngaahi pangikē fakakomēsialé, fakafiemālie ‘a ‘enau tu’unga tupú (profitability) pea pehē ki he kei ‘i he tu’unga mā’ulalo pe ‘a e ngaahi nō ‘oku palopalemá. ‘Oku kei fu’u lahi pē mo e ngaahi pa’anga ngāué ‘a e ngaahi pangikē (excess liquidity), makatu’unga mei he lahi ange ‘a e tupu ‘i he pa’anga tipōsití ‘o fakafehoanaki mo e tupu ‘i he pa’anga nō kuo tuku atú. Na’e kei ma’ulalo pē ‘a e peseti ‘o e ngaahi nō, ‘o fakahoa ki he lahi ‘o ‘enau fakahū pa’angá ‘a ia ne holo ki he peseti ‘e 74.5 ‘i Tīsema 2016. Na’e tokoni ‘a e holo ‘a e totongi tupu ki he ngaahi nō (weighted average lending rate) ki he tupu fakata’u peseti ‘e 17.1 ‘i he ngaahi nō mei he ngaahi pangikē.
‘E kei hokohoko atu ai pē ‘a e tokanga ‘a e Pangikē Pulé ki hono siofi mo muimui’i ofi e ngaahi fakalakalaka faka’ekonōmika fakalotofonuá mo tu’apule’angá, tokangaekina ‘enau ngaahi fokotu’utu’u ngāue fakapa’angá ke pukepuke e ma’uma’uluta ‘a e tu’unga fakapa’angá pea mo langa hake ha sisitemi fakapa’anga ‘oku malu mo lelei.
