CBG reviews exchange rate development, Gov’t fiscal operations

Monday, September 02, 2019

The Monetary Policy Committee (MPC) of the Central Bank of The Gambia (CBG) has on Thursday reviewed the Gambia’s exchange rate development and government fiscal operations.

Bakary K. Jammeh, the governor of Central Bank explained that the foreign exchange market continues to function smoothly, adding that from January to July 2019, volume of transactions measured by the aggregate of purchases and sales of foreign currency increased by 14.0% to US$1.3 million.

He said during the period, purchases of foreign currency, which indicates supply, increased to US$666.7 million, or by 14.4%, saying sales of foreign currency rose by 13.6% to US$662.6 million in the same period.

“The exchange rate of the dalasi remains broadly stable supported by market confidence, and increased inflows from private remittances, higher receipts from tourism, and official inflows from development partners. From December 2018 to July 2019, the dalasi appreciated against the pound sterling and euro by 0.6% and 1.2% respectively. However, it depreciated against the U.S. dollar by 0.9% and CFA by 1.2%.”

On government fiscal operations, he highlighted that preliminary data on government fiscal operations for the first six months of 2019 indicated that total revenue and grants stood at D8.6 billion (9.8% of GDP) compared to D6.9 billion (8.6% of GDP) in the same period last year.

He continued that domestic revenue, comprising tax and non-tax revenues, rose by 23.9% to D5.7 billion (6.5% of GDP) from D4.6 billion (5.8% of GDP) a year ago. He added that tax revenue also rose by 23.7% to D5.2 billion (5.9% of GDP) in the first half of the year from D4.2 billion (5.3% of GDP) in the corresponding period a year ago.

“Total expenditure and net lending declined by 4.0% to D8.8 billion (10.0% of GDP) from D9.2 billion (11.5% of GDP) a year ago. The budget deficit, including grants narrowed to D0.19 billion (0.2% of GDP) in the first six months of 2019 compared to a deficit of D2.3 billion (2.8% of GDP) in the corresponding period a year ago. The budget deficit, excluding grants also improved to a deficit of D3.1 billion (3.5% of GDP) in the first six months of 2019 compared to a deficit of D4.5 billion (5.7% of GDP) in the corresponding period a year ago.”

Author: Pa Modou Cham