Foreign reserves

The National Reserve Bank of Tonga said the reserve is equivalent to 13.1 months of imports.

The NRBT reported that the increase in the foreign reserves resulted from an increase in Tonga’s Special Drawing Rights allocations from the International Monetary Fund and from remittances.

Foreign reserves also increased substantially over the year by $195.6 million, underpinned by receipts of budget support, project funds, and remittances.

Following the previous month’s decline, the reserves fell by $6.7m (US$2.9 million) to $685.7m (US$305.9 million), equivalent to 11.7 months of import, according to the National Reserve Bank of Tonga.

The decline in the Foreign Reserves was due to an increase in import payments during the month.

However, the Governor of the National Reserve Bank of Tonga, said that that annually, the Foreign Reserves had increased significantly by $228.2m (US$101.8 million). “This is mainly attributed to receipts of budget support, official grants, and remittances.”

The National Reserve Bank of Tonga said the current Foreign Reserves is equivalent to 7.9 months of import cover which is still above the minimum range of three to four months.

The impacts of Tropical Cyclone Gita weighed on domestic inflation particularly on food items in March, bringing the annual headline inflation rate to 9.8 per cent.