News

Quarterly Economic Review, December 2018

Published: Saturday March 23rd, 2019

The Central Bank of The Bahamas is pleased to announce the release of its Quarterly Economic Review for the fourth quarter of 2018. The Review provides an examination of the performance of the domestic economy, as well as sectoral developments, principally during the period October to December.

Preliminary indications are that the modest pace of growth in the domestic economy was maintained during the fourth quarter of 2018, supported by ongoing gains in the high value-added stopover segment of the tourism market. In addition, several varied-scale foreign investment projects provided positive impulses to the construction sector. As a consequence, labour market conditions continued to gradually improve; although the unemployment rate edged-up, as the expansion in the workforce-inclusive of previously discouraged workers-outpaced the job gains. In price developments, domestic inflationary pressures remained relatively subdued, with the average rate rising modestly over the twelve months to November, reflecting the pass-through effects of higher international oil prices in earlier periods, as well as the hike in the value added tax (VAT) rate on 1st July.

Provisional data for the second quarter of FY2018/19, showed that the Government's overall deficit narrowed significantly in comparison to the year-earlier period, as the VAT-led increase in aggregate revenue, outstripped the rise in total expenditure. Budgetary financing was obtained primarily from domestic sources and included a combination of long and short-term debt.

Monetary developments were dominated by the contraction in liquidity and external reserves, as credit growth contrasted with the reduction in the deposit base, amid the seasonal increase in foreign currency demand during the latter half of the year. Further, banks' credit quality indicators improved, underpinned by modest gains in economic conditions, alongside entities' ongoing debt restructuring activities and loan write-offs. In addition, the latest available data for the third quarter revealed that banks' overall profitability strengthened, associated largely with a decline in bad debt provisioning and lower operating outlays.

In the external sector, the estimated current account deficit widened during the final quarter of 2018. Underlying this outturn was a notable reduction in the services account surplus, combined with higher net income and current transfer outflows. In addition, the surplus on the capital and financial account contracted sharply, attributed to the net repayment of the public sector's net external liabilities, in contrast to the prior period, when Government's external bond issue led to a surge in the surplus.

For full text reading, please download the attached document.

Search News

Search News using the form below. Leave the keyword field empty for a list of all entries in the selected category.


Separate keywords by commas.

News