The Governor of Central Bank Bakary Jammeh has announced that the country’s gross official reserves have reached 4.2 months of imports of goods and services in August 2017.
Speaking during a the traditional quarterly meeting between the bank’s monetary policy committee and the media, Jammeh told journalists on Friday that such a rare improvement has not occurred in the country in a very long time.
“Usually, the reserves stand at 2 to three months of imports cover,” he said.
Jammeh attributed this “rare improvement” to the “unwavering support of development partners, especially the IMF, World Bank, EU and the ADB.”
He said international reserves improved from $19.84million in Dec to $112.2million in August 2017adding that quasi money increased by 24.2 % to D13.0 billion during same period. However growth of reserve money remained same at 16.1% in June 2017.He further disclose that the Balance of Payment estimates, a surplus of 3.2million compared to $1.0millin from last year.
Current account balance improved from a deficit of $38.4 million in first half of 2016 to a deficit of $36.8 million but he said with such a “comfortable” state of the economy at a lean economic season, the prospects a even better with the coming of the tourism and agriculture season. “Central Bank may not even have to borrow from the commercial banks. Rather, we will be selling our excess forex reserves to them,” he said.
CBG further described the D48 billion mounting debt of the country inherited from the past regime as a “major risk” to the macroeconomic outlook of the country. “The Committee noted that economic conditions continue to improve in 2017 and the outlook remains broadly favorable against the backdrop of projected increase in agricultural production, increased inflows, rebound in tourism and trade and restoration of confidence in the domestic economy,” the bank said in a statement.
“Moreover, monetary and fiscal policies would remain prudent and well-coordinated. International reserves of the Bank have reached a comfortable level. Foreign exchange market conditions are expected to continue to improve and the Dalasi would remain stable. In the light of these developments, inflation is projected to continue to decline in the near-term… The major risk to macroeconomic outlook is the level of debt (120 percent of GDP) inherited from the past regime.”