The Reserve Bank of Fiji (RBF) has warned that risks to the country’s economic outlook remain tilted to the downside, citing elevated global fuel prices, higher electricity costs and softer travel demand as key concerns.
In its May 2026 Economic Review, the central bank said external pressures continue to pose challenges to Fiji’s economic recovery, particularly as major trading partners maintain tighter monetary conditions.
“Key external risks stem from elevated global fuel prices and tighter monetary conditions in Fiji’s major trading partner economies, potentially impacting the already moderating travel demand,” the RBF said.
The bank also highlighted growing domestic pressures following Energy Fiji Limited’s recent tariff increase, warning that higher electricity costs could affect business operations across the country.
“Domestically, the recent increase in electricity tariff by EFL is expected to increase operating costs for businesses, disrupt production, and weigh on economic activity,” the review stated.
Despite these challenges, Fiji’s foreign reserve position remains strong for now.
The RBF reported that foreign reserves stood at approximately $3.4 billion as of May 28, enough to cover 4.9 months of retained imports.
“Foreign reserves stood at around $3.4 billion (as of 28 May), sufficient to cover 4.9 months of retained imports and are currently projected to remain adequate in the medium term,” the bank said.
However, the central bank cautioned that this position could come under pressure if global energy and freight costs remain volatile.
“Downside risks persist, as ongoing volatility in global fuel prices and freight costs may exert earlier-than-anticipated pressure on reserves,” the RBF warned.
The central bank said it will continue to closely monitor developments both at home and abroad and stands ready to respond if economic conditions deteriorate.
“The RBF will continue to closely monitor evolving economic conditions and stands ready to implement appropriate measures, as needed, to preserve macroeconomic stability in line with its mandate.”
The assessment comes as Fiji grapples with a prolonged fuel supply crisis and rising operating costs, while tourism growth and consumer spending show signs of moderating after several years of strong post-pandemic recovery
