The National Reserve Bank of Tonga’s Board of Directors at its board meeting on the 15th August 2019, approved to maintain its current monetary policy measures outlined below. This is to encourage the utilization of the excess liquidity in the banking system, through further lending 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%, and
- maintain the inflation reference rate at 5%.
The Governor of the Reserve Bank, Sione Ngongo Kioa, reported that domestic activities continued to reflect mixed performance in the month of June 2019. Partial available data indicates mixed sectoral performance in the primary sector. The total volume of agricultural exports decreased due to lower exports of squash and cassava following an offseason squash shipment on the previous month. Fish exports, however, more than doubled over the month owing mostly to exports of tuna, although exported aquarium products dropped. Export receipts from exports of both agricultural and marine products declined during the month. Construction activities slowed during the month, corresponding to the decline in lending to the industry. However, road improvement projects continue to support the mining & quarrying sector. The number of electricity consumers has steadily increased throughout the year, reflecting new houses constructed as well as the Tonga Power Ltd network upgrade projects. The tertiary sector was quite busy in June with the annual general conference of the Free Wesleyan Church and Heilala Festivities. Container registrations rose by 270 containers over the month, the majority of the containers were for businesses indicating a thriving consumption and active trade sector. International air arrivals also increased with more international flights as visitors attended the June events, further contributing to the tourism, transport and communications sectors.
The banking system remained sound as banks continued to maintain a strong capital position backed by adequate profits. The banks’ total loans to deposit ratio fell over the month to 77.9% from 78.7% in the previous month, reflecting declining loans against increasing deposits. This ratio remains below the 80% minimum loan to deposit ratio indicating the capacity available for further lending. The weighted average interest rate spread widened in June to 6.09% driven mainly by a decline in weighted average deposit rates outweighing the decline in weighted average lending rates.
Official foreign reserves rose by $16.0 million in June 2019 to $484.3 million, equivalent to 8.1 months of imports cover, as expected funds for budgetary support were received before the closing of the fiscal year.
The annual headline inflation was 1.8% in June, compared to 3.0% in the same month last year. Both imported and domestic prices rose over the year by 1.9% and 1.7%, respectively. Imported inflation contributed 1.0% to the annual headline inflation and was due to higher prices of imported food, tobacco, alcohol, maintenance & repair, and fuel. Domestic inflation contributed 0.8% to the annual headline inflation as higher prices were noted for food, tobacco, and restaurant services.
Tonga’s economic performance continues to remain positive in the medium term. However, weather uncertainty and global oil price movements pose a risk to the outlook. The level of foreign reserves is projected to remain at a comfortable level, and inflation is expected to remain below the reference rate of 5%. The banking system is anticipated to continue to remain sound.
In consideration of the above developments and outlook, the current monetary policy stance is considered appropriate in the medium term. The Reserve Bank continues to adopt measures to encourage the utilization of the excess liquidity in the banking system to increase lending, support domestic economic activities, and strengthen the monetary policy transmission mechanism. The Reserve Bank will continue to remain vigilant and closely monitor external and domestic developments and may change its monetary policy setting to support its monetary policy objectives.
Na‘e tali ‘e he Poate ‘a e kau Talēkita ‘o e Pangikē Pule Fakafonua ‘o Tonga´ hili ‘enau fakataha ‘i he ‘aho 15 ‘o ‘Aokosi 2019, ke kei hokohoko atu ai pē ‘a e ngaahi tu‘utu‘uni ngāue fakapa‘anga lolotonga´ ‘a ia ‘oku hā atu ‘i lalo´. ‘Oku fakataumu‘a eni ke ngāue’aki ‘a e hulu ‘i he pa‘anga ngāue ‘a e ngaahi pangikē, ki hono tuku atu ‘a e ngaahi nō ki tu’a ke ne faka‘ai‘ai mo pātoloaki ‘a e tupu faka‘ekonōmika ‘a e fonua´.
- Ke kei hoko atu pē hono ta’etotongi ha tupu (interest) ‘i he ngaahi ‘akauni pa‘anga ngāue ‘a e ngaahi pangikē´ (Exchange Settlement Account) ‘oku fakahū ‘i he Pangikē Pule´ (zero interest rate policy);
- Ke ‘oua ‘e toe ma‘ulalo hifo ‘i he peseti ‘e 80 ‘a e lahi e ngaahi nō ‘oku tuku atu ‘e he ngaahi pangikē ‘o fakahoa ki he lahi ‘o ‘enau ngaahi fakahū pa‘anga´ (loans/deposit ratio);
- Ke kei tu’uma’u pē ‘a e lahi ‘o e pa‘anga ‘a e ngaahi pangikē fakakomēsiale´, ‘a ia ‘oku tu‘utu‘uni fakalao ke tauhi ‘i he Pangikē Pule´ (Statutory Reserve Deposit) ‘i he peseti ‘e 10; pea
- Ke tauhi pē ‘a e tu‘unga ‘o e hikihiki ‘i he totongi ‘o e ngaahi koloa´ (inflation reference rate) ke ‘oua na’a laka hake he peseti ‘e 5.
Na‘e fakahā ‘e he Kōvana ‘o e Pangikē Pule´, Sione Ngongo Kioa, ’oku kei fetō‘aki pē ‘a e ngaahi ngāue faka‘ekonōmika ‘a e fonua´ ‘i he māhina ‘o Sune 2019. Na‘e hā mai eni he konga ‘o e ngaahi fakamatala kuo ma‘u mai fekau‘aki mo e sekitoa ki he ngoue΄, toutai΄ pea mo e vao‘akau΄. Na‘e holo ‘a e lahi ‘o e ngoue ne uta atu ki tu‘apule‘anga΄, koe‘uhi΄ ne si‘isi‘i ange ‘a e manioke mo e hina ne uta atu ‘i he mahina ni΄ fakatatau ki he mahina kuo‘osi΄. Na‘e lahi ange ‘i he liunga ua ‘a e lahi ‘o e ika ne uta atu ki muli΄, makatu‘unga mei hono uta atu ‘o e valu΄, neongo na‘e holo hono uta atu ‘o e ngaahi me‘atahi ‘oku malava ke fakaili (aquarium). Na‘e holo ‘a e pa‘anga hū mai mei hono uta atu ki muli ‘a e ngoue mo e toutai΄ ‘i he lolotonga ‘o e mahina΄. Na‘e māmālie ange ‘a e ngaahi ngāue ‘i he sekitoa langa΄ ‘o fakatatau ki he si‘isi‘i ange ‘a e nō ki he sekitoa΄ ko eni. Kaekehe, ‘oku tokoni ‘a e ngaahi ngāue fakalelei ki he hala pule‘anga΄ ki he sekitoa keli‘anga maka΄ mo e maka koloa΄. ‘Oku hikihiki pē ki ‘olunga ‘a e tokolahi ‘o e kau ma‘u ‘uhila΄ ‘i he lolotonga ‘o e ta‘u΄, ‘o fenāpasi ia mo e ngaahi langa fale fo΄ou ‘oku fakahoko΄ pea tokoni ki ai mo e ngaahi polōseki ‘a e Kautaha ‘Uhila ‘a Tonga. Na‘e tokoni e konifelenisi fakata‘u ‘a e Siasi Uesiliana Tau‘ataina ‘a Tonga΄ pea mo e Uike Heilala΄ ki he tafa‘aki ‘o e ngaahi ngāue΄. Na‘e hiki hake ‘aki ‘a e koniteina ‘e 270 e lahi ‘a e ngaahi koniteina na‘e lesisita΄ ‘o lahi taha pē ai e ngaahi koniteina fakapisinisi΄ ‘o mahino mei ai ‘a e lahi ange á e fakatau ‘a e kakai΄ mo e mo’umo’ua ‘a e sekitoa fefakatau‘aki΄ ‘i he māhina΄. Na‘e tokolahi ange e kau pāsese΄, fakataha mo e lahi ange ‘a e vakapuna folau fakavaha‘apule‘aga ne tū‘uta mai ki Tonga΄ni, ke nau kau atu ki he ngaahi kātoanga ne fakahoko ‘i Sune΄, ‘a ia ‘oku kau lelei aipē ia ki he sekitoa takimamata΄, fefononga‘aki΄ pea mo e fetu‘utaki΄.
‘Oku kei ‘i he tu‘unga fakafiemālie pē ‘a e fai fatongia ‘a e ngaahi pangikē fakakomēsiale´, ‘a ia ‘oku kei hokohoko atu pē ‘a e mālohi fe‘unga pē ‘a e ivi ‘enau pa‘anga ngāue´, pehē ki he‘enau ngaahi tupu´ (profits). Na‘e holo ‘a e pēseti ‘o e ngaahi nō ne tuku atu´ ‘i hono fakahoa ki he lahi ‘o e ngaahi fakahū pa‘anga´ (loans/deposit ratio), mei he pēseti ‘e 78.7 ‘i he mahina kuo ‘osi΄, ki he pēseti ‘e 77.9 ‘i Sune 2019. ‘Oku kei ma‘ulalo pē eni ‘i he peseti ‘e 80 kuo tu‘utu‘uni ‘e he Pangikē Pule´ ke a‘usia ‘e he ngaahi pangikē fakakomēsiale´, ‘o hā mahino mei ai ‘a e faingamālie ke toe lahiange ‘a e ngaahi nō ‘oku tuku atu΄. Na‘e hiki hake ki he peseti ‘e 6.09 ‘a e ‘avalisi ‘o e totongi tupu ‘i he nō mo e fakahū pa’anga´ (weighted average interest rate spread) ‘i Sune, tupu pea meiˊ he lahiange ‘a e holo ‘i he ‘avalisi ‘o e totongi tupu ‘i he fakahū pa‘anga´ (weighted average deposit rate) ‘i hono fakahoa ki he holo ‘a e ‘avalisi ‘o e totongi tupu ‘i he nō, (weighted average lending rate).
Na‘e hiki hake ‘a e tu‘unga ‘o e pa‘anga talifaki ‘i muli´ (foreign reserves) ‘aki ‘a e $16.0 miliona ki he $484.3 miliona ‘i Sune 2019, ‘o fe‘unga ia mo e māhina ‘e 8.1 ‘o e koloa mo e ngaahi ngāue hū mai mei muliˊ. Na‘e makatu‘unga ‘a e hiki ko eni΄ mei he ma‘u mai ‘o e ngaahi pa‘anga tokoni ki he patiseti΄ kimu‘a pea ‘osi ‘a e ta‘u fakapa‘anga΄.
Na‘e peseti ‘e 1.8 ‘a e hikihiki fakata‘u ‘i he totongi ‘o e koloa fakalukufua΄ ‘i Sune΄ ‘o fakahoa ki he peseti ‘e 3.0 ‘i he taimi tatau he ta‘u kuo‘osi΄. Na‘e hiki fakatou‘osi ‘a e hikihiki fakata‘u ‘i he totongi koloa mei muli΄ ‘aki ‘a e peseti ‘e 1.9 kae hiki peseti ‘e 1.7 ‘a e totongi koloa fakalotofonua΄. Na‘e tokoni fakapoini peseti ‘e 1.0 ‘a e hikihiki ‘i he totongi koloa mei muli΄ ki he totongi koloa fakalukufua΄, ‘aki ‘a e hiki e totongi ‘o e me‘akai΄, tapaka΄, kava malohi΄, ngaahi ngāue fakalelei mo fakafo‘ou ‘api nofo‘anga΄, pea mo e totongi lolo΄. Na‘e tokoni fakapoini peseti ‘e 0.8 ‘a e hikihiki ‘i he totongi koloa fakalotofonua ki he totongi koloa fakalukufua΄, ‘o makatu‘unga mei he hiki ‘a e totongi ‘o e me‘akai΄, tapaka΄, pea mo e totongi ‘o e ngaahi falekai΄.
‘Oku fakafuofua ‘e he Pangikē Pule´ ‘e kei tupu pē ‘a e tu’unga faka’ekonōmika ‘a e fonua´ ‘i he kaha’u vave mai´. Kā ‘e malava uesia ‘a e fakafuofua ko ‘eni´ mei he ngaahi feliuliuaki ‘i he tu’unga ‘o e ‘ea´ pea mo e ngaahi fe‘unu‘aki ‘i he totongi fakamāmani lahi ‘o e lolo΄. Ko e pa‘anga talifaki ‘i mulí´ ‘oku fakafuofua ‘e kei ‘i he tu’unga fakafiemālie pē, pea ‘oku ‘amanaki ‘e nofo pē ‘a e hikihiki ‘i he totongi koloaˊ ‘o ‘ikai ma’olunga ange he pēseti ‘e 5. Ko e ngaahi pangikē ‘oku fakafuofua ‘e ‘i he tu‘unga fakafiemālie pē mo ‘enau ngaahi ngāue΄.
Makatu‘unga pea mei´ he ngaahi fakamatala kuo fakahā atu ‘i ‘olunga´, ‘oku kei taau ke hokohoko atu pē ‘a e ngaahi tu‘utu‘uni ngāue fakapa‘anga lolotonga´. ‘Oku kei fakahoko pē ‘e he Pangikē Pule´ hono siofi ke fakahoko ha ngaahi fokotu‘utu‘u ngāue te ne faka‘ai‘ai ‘a hono ngāue’aki ‘a e hulu ‘i he pa’anga ngāue ‘a e ngaahi pangikē, ki hono nō atu ke tokoni ki he ngaahi ngāue faka’ekonōmika fakalotofonua´, pea ke poupou mo pātoloaki ha tupu faka‘ekonōmika ‘oku ma‘uma‘uluta mo tolonga. ‘Ikai ngata ai´, ka ‘oku tokanga aipe ‘a e Pangikē Pule´ ki hono muimui‘i ofi e ngaahi fakalakalaka faka‘ekonōmika fakalotofonua´ mo fakatu‘apule‘anga´, mo tu‘u mateuteu ke liliu ‘a e ngaahi fokotu‘utu‘u ngāue fakapa‘anga´ ‘o ka fiema‘u.
