Tonga Foreign Reserves declined in April

Tonga’s Foreign Reserves has declined to $445.9 million pa’anga in April due to higher interbank payments during the month.

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.

The Reserve Bank projects headline inflation for April to be above 5 per cent reference rate due to higher expectations in the prices of food, transportation, tobacco, alcohol and Tongan kava roots with continuation to add on to the inflation.

Domestic food supply is projected to recover by the end of the year after the impacts of the cyclone hence inflation is anticipated to fall below 5 per cent per annum by the end of the year.