- Decision
- Maintain
- Rate change
- 0 bps
- Overnight policy rate
- 0.25%
The Reserve Bank of Fiji’s board left the Overnight Policy Rate at 0.25 percent at its 24 April meeting, citing an easing in annual inflation to 1.5 percent in March and still-solid foreign reserves as grounds for maintaining an accommodative stance. The rate has been unchanged at 0.25 percent in every meeting since January 2025. System liquidity remains ample at FJD 1.9 billion, helping keep lending rates low and underpinning an 11.0 percent year-on-year rise in private-sector credit, while foreign reserves of FJD 3.5 billion cover 5.6 months of imports and are projected to stay adequate. Although consumption, investment and resource-based production continue to expand, first-quarter visitor arrivals fell 5.3 percent on declines from Australia and New Zealand, tempering overall growth momentum, even as business sentiment stays positive. The board warned that escalating US–China trade tensions and the IMF’s cut to its 2025 global growth forecast to 2.8 percent heighten external risks. The central bank will keep tracking domestic and international developments and stands ready to adjust policy if needed.
Rate evolution
From June 2025 to September 2026, the Reserve Bank of Fiji kept the Overnight Policy Rate at 0.25%, maintaining support for economic activity. The holds through early 2026 reflected subdued inflation and adequate foreign reserves amid firm demand, and in February the Reserve Bank judged the rate appropriate as January headline inflation fell to -2.5% and core inflation stayed near 0.8%, while forecasting year-end headline inflation at 2.5%-3.0% and flagging risks from trade and Middle East tensions, commodity prices, electricity tariffs, elections, tourism demand and cyclone shocks.
By 25 June, the Board again held the rate as it balanced rising domestic prices, adequate foreign reserves and support for activity, noting that headline inflation had reached 3.9% and was expected at about 6.0% by year-end, while higher global fuel prices dampened travel demand and prompted a cut in the 2026 growth forecast to 1.5% from 3.0%. On 30 July, it maintained the rate as activity slowed and import costs lifted inflation to 6.1% in June, and on 27 August it held again to support activity and adequate reserves amid supply-driven inflation, which eased to 5.7% in July but was expected to remain elevated due to global fuel and freight costs.
On 24 September, the Board again held the rate, balancing heightened inflationary pressure driven largely by external factors with support for growth amid weakening conditions, as headline inflation rose to 7.6% in August from 5.7% in July on higher food, energy and kava prices and the fading effect of the August 2025 value-added tax rate reduction. Inflation was expected to remain above 6.0% through year-end amid volatile global commodity prices and weather risks from the developing El Niño event, while reserves of around FJD 3.9 billion covered 5.5 months of retained imports and economic activity tracked expectations on tourism, consumer spending and construction.