Strong tourism activity and remittance inflows are continuing to support consumer spending in Fiji, while investment indicators are pointing to increased economic activity, according to the Reserve Bank of Fiji’s August Economic Review.
Consumption-related lending grew by 1.2 per cent in the year to July, driven mainly by a 14.3 per cent increase in lending to private individuals.
Vehicle registrations also increased by 9.9 per cent, with new vehicle registrations rising 12.9 per cent and second-hand registrations up 7.5 per cent.
However, the RBF warned that higher import duties on new and second-hand vehicles announced in the 2026-27 National Budget could weigh on vehicle demand going forward.
Investment activity also remained positive.
New investment lending surged by 38.3 per cent in the year to July, driven largely by increased lending to the building and construction sector, which rose 67.7 per cent, and real estate, which increased 34.7 per cent.
Domestic cement sales recorded strong growth of 38.2 per cent, reflecting sustained demand from ongoing development projects.
Construction-related imports also increased by 20.6 per cent up to May, supported by increased construction activity and growing use of prefabricated building materials.
The RBF said financial conditions remained supportive of economic activity, with ample liquidity in the banking system and low interest rates.
Banking system liquidity stood at approximately $2.1 billion as of August 28, helping keep borrowing costs low.
Both commercial banks’ weighted average new and outstanding lending rates stood at 4.50 per cent in July.
The accommodative financial conditions also supported strong private sector credit growth of 14.6 per cent.
Broad money expanded by 7.8 per cent in July, reflecting continued growth in liquidity and credit within the economy.
The latest indicators suggest domestic demand remains resilient, with tourism and remittances supporting household spending while construction, real estate and other investment activity continue to expand.
