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MEFD August 2009

Published: Monday October 5th, 2009

Despite a short-term boost to the tourism sector, provided by the hosting of an international event during the review month, indications are that the effects of the worldwide economic recession continued to subdue domestic economic activity. Price developments were comparatively favourable, as the easing in inflationary pressure witnessed since the beginning of 2009, was sustained in August. Weak private sector demand conditions continued to support buoyancy in overall bank liquidity and, although the combination of lower foreign currency inflows and the seasonal, but below trend foreign currency demand exerted downward pressure on external reserves, the stock was bolstered by the International Monetary Fund’s recent general Special Drawing Right (SDR) allocation under its initiative to enhance global liquidity.

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