Gambian Dalasi Weakens Against Dollar and Pound

CBG Governor Mr. Amadou Colley

The Gambia’s currency, Dalasi, has depreciated against the US Dollar and Pound Sterling by 6.86 per cent and 4.64 per cent respectively, Governor of the Central Bank of the Gambia, Mr. Amadou Colley, said.

Speaking on Friday May 11, 2012 during the quarterly press conference of the Monetary Policy Committee (MPC) of the Central Bank of the Gambia, Governor Colley pointed out that year-on-year to end April 2012, the currency appreciated against the Euro by 4.49 percent, and in nominal effective exchange rate terms, it depreciated by 5 percent.

According to him, as at end-March 2012, the domestic debt increased to D9.2 billion equivalent to 31.3per cent of Gross Domestic Product.   Treasury bills and Sukuk-Al-Salaam, which together accounts for 78.8 per cent of the debt stock, rose to D7.43 billion compared to D6.0 billion in March 2011.

He said the yield on maturity of both the Treasury bills and Sukuk-Al-Salaam increased with the exception of the 364 day bills which declined to 12.80 percent from 13.09 percent in March2011.

“Provisional balance of payments estimate indicate an overall surplus of US$31.73 million in 2011, but lower than the US$86.52 million in 2010,” he noted.

He further said as at end-March 2012, gross international reserves totaled US$1820.0 million equivalent to 5.0 months of import cover, saying that volume of transactions in the foreign exchange market, measured by aggregate purchases and sales, declined to US$1.45billion in the year to end-April 2012 from US$1.59 billion a year earlier.

He cited that the key financial soundness indicators show that the banking industry remains sound with sufficient capital and liquidity adding that the industry’s risk-weighted capital adequacy ratio increased slightly to 26.6 percent at end March 2012 from 25.9 percent in March 2011 and significantly above the statutory requirement of 10.0 percent.

He said: “The assets of the (banking) industry increased to D18.8 billion in March 2012, or 4.5 per cent from a year ago. Loans and advances, accounting for 30 per cent of assets, decreased to D5.3 billion or 2.4 per cent from a year ago.

However, Central Bank Governor observed that non performing loans ratio decreased significantly to 8.7 per cent in March 2012 compared to 13.3 per cent in March 2011.

Inflation decelerated

End-period inflation, measured by the National Consumer Price Index (NCPI), decelerated to 3.9 percent at end March 2012 from 5.4 per cent in March 2011, the governor said.

He also said the average inflation (12 month moving average) was at a 12 month low of 4.5 per cent compared to 5.4 per cent in March 2011.  He explained that this was primarily the result of the moderation in food price inflation.

Consumer food inflation, the most important determination of headline inflation, decelerated from 7.5 per cent in March 2011 to 4.8 per cent in March 2012 while non food consumer price inflation rose to 2.7 per cent from 2.0 per cent in March 2011.

He added that core inflation which excludes the prices of energy, utilities and volatile food items, decreased to 4.0 per cent relative to the 5.3 per cent in March 2011.

However, Governor Colley said inflation is expected to remain below the target of 5 per cent, owing to the subdued state of the economy and moderation in the growth of the monetary aggregates. Source: The Voice

Written by Modou S. Joof 

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