The Asian Development Bank says reduced VAT rates and strong supply have helped keep prices low in Fiji, with deflation recorded throughout most of 2025.
In its latest report on Fiji released last week, the ADB noted that Fiji experienced ten consecutive months of deflation, resulting in an overall 1.4 per cent decline in prices for the year.
“Ten consecutive months of deflation… culminated in no headline inflation in December,” the report stated.
Lower prices for food, transport, fuel and household goods were key drivers, offsetting increases in areas such as alcohol, restaurants and services.
Despite falling prices, consumption remained robust, supported by strong lending and income flows.
“Consumption indicators remain strong,” the ADB said, pointing to a 23.6 per cent increase in new consumption lending and a 9.2 per cent rise in private sector credit.
The report also highlighted growth in inward remittances and a surge in vehicle registrations, signalling continued consumer confidence.
“An accommodative monetary policy… and ample banking liquidity have helped keep interest rates low,” the ADB said.
The bank added that higher wages and improved access to credit continue to support domestic demand, even as price pressures remain subdued.
