Monetary Policy (February 2017) – Monetary Policy (February 2017) – Maneho monetario (Februari 2017)
Monetary Policy (February 2017)
During its meeting of February 2, 2017, the Monetary Policy Committee (MPC) of the Centrale Bank van Aruba (CBA) decided to keep the reserve requirement at 11.0 percent and to uphold the advance rate at 1.0 percent, after reviewing the most recent economic and monetary data. The following information and analysis were considered in reaching this decision.
International reserves
The international reserves (including revaluation differences of gold and foreign exchange holdings) and official reserves remained at adequate levels at the end of December 2016. Both registered increases of, respectively, Afl. 281.5 million (+17.5 percent) and Afl. 193.3 million (+13.1 percent), compared to December 2015. Consequently, the international reserves reached Afl. 1,952.2 million at end-December 2016.
Credit developments
Overall credit within the commercial banking system noted an increase (+2.5 percent) at the end of December 2016 versus December 2015. Business loans and housing mortgages rose by 1.2 percent and 4.6 percent, respectively, while consumer credit declined by 4.8 percent.
Inflation
In December 2016, a decrease was registered in both the end of period (−0.3 percent) and the 12-month average price level (−0.9 percent). The latter was particularly due to lower gasoline prices and a reduction in the electricity tariffs in January 2016. The 12-month core inflation edged up by 0.5 percent, mainly reflecting increases in the housing component of the Consumer Price Index.
Tourism
During 2016, tourism indicators showed signals of weakness, as declines were noted in visitor nights (−4.3 percent), tourism receipts recorded at commercial banks (−3.2 percent), and stay-over visitors (−10.0 percent), compared to 2015. One exception to these negative developments was the upturn recorded in cruise visitors (+8.1 percent).
Money supply
In December 2016, money supply registered an increase of Afl. 93.0 million to Afl. 4,166.4 million compared to the previous month, resulting from an expansion in the net domestic assets (+Afl. 102.4 million), partly offset by a decline in the net foreign assets (−Afl. 9.4 million). While the increase in the domestic component of the money supply stemmed from both the domestic credit (+Afl. 98.1 million) and non-credit related balance sheet items (+Afl. 4.3 million), the decline in the net foreign assets of the banking sector was due to net sales of foreign exchange of Afl. 213.7 million to the public. These were mainly associated with mostly related to net payments for goods, portfolio investment, other services, and other investment, which were largely counter-balanced by net purchases of foreign exchange of Afl. 204.3 million from the public, mainly associated with tourism, capital transactions, and net transfers from foreign accounts.
Financial markets
In December 2016, an increase was registered in the weighted average interest rate on new deposits (+0.4 percentage point to 2.0 percent), whereas a decline was recorded in the weighted average interest rate on new loans (−1.0 percentage point to 6.9 percent), when compared to the previous month. Consequently, the weighted average interest rate margin fell by 1.5 percentage points to 4.8 percent.
Advance rate
The determinants of the CBA’s advance rate stayed stable. The margin between the CBA’s advance rate and the Federal Funds rate stood at 0.46 percentage point in December 2016. Consequently, there was no need to change the CBA’s advance rate.
Centrale Bank van Aruba
March 1, 2017
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Monetary Policy (February 2017)
During its meeting of February 2, 2017, the Monetary Policy Committee (MPC) of the Centrale Bank van Aruba (CBA) decided to keep the reserve requirement at 11.0 percent and to uphold the advance rate at 1.0 percent, after reviewing the most recent economic and monetary data. The following information and analysis were considered in reaching this decision.
International reserves
The international reserves (including revaluation differences of gold and foreign exchange holdings) and official reserves remained at adequate levels at the end of December 2016. Both registered increases of, respectively, Afl. 281.5 million (+17.5 percent) and Afl. 193.3 million (+13.1 percent), compared to December 2015. Consequently, the international reserves reached Afl. 1,952.2 million at end-December 2016.
Credit developments
Overall credit within the commercial banking system noted an increase (+2.5 percent) at the end of December 2016 versus December 2015. Business loans and housing mortgages rose by 1.2 percent and 4.6 percent, respectively, while consumer credit declined by 4.8 percent.
Inflation
In December 2016, a decrease was registered in both the end of period (−0.3 percent) and the 12-month average price level (−0.9 percent). The latter was particularly due to lower gasoline prices and a reduction in the electricity tariffs in January 2016. The 12-month core inflation edged up by 0.5 percent, mainly reflecting increases in the housing component of the Consumer Price Index.
Tourism
During 2016, tourism indicators showed signals of weakness, as declines were noted in visitor nights (−4.3 percent), tourism receipts recorded at commercial banks (−3.2 percent), and stay-over visitors (−10.0 percent), compared to 2015. One exception to these negative developments was the upturn recorded in cruise visitors (+8.1 percent).
Money supply
In December 2016, money supply registered an increase of Afl. 93.0 million to Afl. 4,166.4 million compared to the previous month, resulting from an expansion in the net domestic assets (+Afl. 102.4 million), partly offset by a decline in the net foreign assets (−Afl. 9.4 million). While the increase in the domestic component of the money supply stemmed from both the domestic credit (+Afl. 98.1 million) and non-credit related balance sheet items (+Afl. 4.3 million), the decline in the net foreign assets of the banking sector was due to net sales of foreign exchange of Afl. 213.7 million to the public. These were mainly associated with mostly related to net payments for goods, portfolio investment, other services, and other investment, which were largely counter-balanced by net purchases of foreign exchange of Afl. 204.3 million from the public, mainly associated with tourism, capital transactions, and net transfers from foreign accounts.
Financial markets
In December 2016, an increase was registered in the weighted average interest rate on new deposits (+0.4 percentage point to 2.0 percent), whereas a decline was recorded in the weighted average interest rate on new loans (−1.0 percentage point to 6.9 percent), when compared to the previous month. Consequently, the weighted average interest rate margin fell by 1.5 percentage points to 4.8 percent.
Advance rate
The determinants of the CBA’s advance rate stayed stable. The margin between the CBA’s advance rate and the Federal Funds rate stood at 0.46 percentage point in December 2016. Consequently, there was no need to change the CBA’s advance rate.
Centrale Bank van Aruba
March 1, 2017
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Maneho monetario (Februari 2017)
Durante e reunion di dia 2 di Februari 2017 e Comite di Maneho Monetario (CMM) di Banco Central di Aruba (BCA) a dicidi pa mantene e porcentahe actual di e tasa di e “reserve requirement” na 11 porciento y e “advance rate” na 1 porciento, despues di a evalua e datonan economico y monetario mas recien. A considera e siguiente informacion y analisis den e proceso pa yega na e decision aki.
Reservanan internacional
E reservanan internacional di divisa (incluyendo diferencianan den revaluacion di oro y di reservanan internacional) y e reservanan oficial a mantene nivelnan adecua na fin di December 2016. Ambos a registra aumentonan di, respectivamente, Afl. 281,5 miyon (+17,5 porciento) y Afl. 193,3 miyon (+13,1 porciento), compara cu December 2015. Consecuentemente, e reservanan internacional y e reservanan oficial a yega, respectivamente, na Afl. 1.892,4 miyon y Afl. 1.689,9 miyon na fin di December 2016.
Desaroyonan den credito
E total di credito di e banconan comercial a mustra un aumento (+2,5 porciento) na final di December 2016 compara cu December 2015. Credito na empresa y fiansa pa construccion di cas a aumenta cu 1,2 porciento y 4,6 porciento, respectivamente, mientras cu credito na consumidor a baha cu 4,8 porciento.
Inflacion
Na December 2016 a registra deflacion den e prijsnan compara cu e aña anterior (−0,3 porciento) como tambe den e promedio anual di inflacion (−0,9 porciento). E ultimo ta principalmente causa pa prijsnan mas abou di gasolin y un bahada den e tarifa di coriente na Januari 2016. E promedio di inflacion ora exclui e componentenan di cuminda y energia a yega na 0,5 porciento, primordialmente reflehando un aumento den e componente di vivienda di e Indice di Prijs di Consumo.
Turismo
Durante 2016, indicadornan di turismo a mustra señalnan di debilidad, como cu a nota caidanan den e cantidad di anochinan permaneci na Aruba (−4,3 porciento), ingresonan turistico registra na banconan comercial (−3,2 porciento) y e cantidad di bishitantenan (−10,0 porciento), compara cu 2015. Un excepcion na e desaroyonan negativo aki ta un subida registra den e cantidad di turistanan crucero (+8,1 porciento).
Placa den circulacion
Na December 2016 e cantidad di placa den circulacion a subi cu Afl. 93,0 miyon te na Afl. 4.166,4 miyon, compara cu e luna anterior. Esaki a resulta for di un aumento den e activo domestico neto (+Afl. 102,4 miyon), parcialmente mitiga pa un caida den e reserva di divisa neto (+Afl. 9,4 miyon). Mientras cu e subida den e activo domestico neto a resulta door di tanto e credito domestico (Afl. 98,1 miyon) como transaccionnan no relata na credito (+Afl. 4,3 miyon), e caida den e reserva di divisa neto di e sector bancario tawata di un banda debi na e benta neto di divisa di Afl. 213,7 miyon na publico. Esaki tabata primordialmente en coneccion cu pagonan neto pa e importacion di bienes, inversion di portfolio, otro servicionan y otro inversionnan. Di otro banda, e benta neto aki a wordo mitiga pa e compra neto di divisa di Afl. 204,3 miyon for di publico, principalmente asocia cu turismo, transaccionnan riba e cuenta di capital y transfarencia neto for di cuentanan den exterior di companianan local.
Mercado financiero
Na December 2016 a nota un aumento den e promedio di interes riba depositonan nobo (+0,4 punto di porcentahe te na 2,0 porciento), mientras cu un bahada a wordo registra den e promedio di interes riba prestamonan nobo (−1,0 punto di porcentahe te na 6,9 porciento), compara cu e luna anterior. Consecuentemente, e margen di e tasa di interes riba prestamonan nobo a cai cu 1,5 punto di porcentahe te na 4,8 porciento.
Advance rate
E determinantenan di e “advance rate” di BCA a keda stabil. E margen entre e “advance rate” di BCA y e “Federal Funds rate” tabata 0,46 punto di porcentahe na December 2016. Consecuentemente, no tabata tin razon pa cambia e “advance rate” di BCA.
Banco Central di Aruba
29 di Maart 2017