Net
foreign assets of the banking system dropped by Rs1,587 million or by 5.3 per
cent, from Rs30,123 million at the end of March 2001 to Rs28,536 million at the
end of April 2001. Net foreign assets of Bank of Mauritius rose by Rs232
million or by 1.1 per cent, from Rs21,447 million to Rs21,679 million whereas
net foreign assets of commercial banks went down by Rs1,819 million or by 21.0
per cent, from Rs8,676 million to Rs6,857 million.
Domestic
credit expanded by Rs2,989 million or by 3.3 per cent, from Rs89,608 million at
the end of March 2001 to Rs92,597 million at the end of April 2001.
Net
credit to Government rose by Rs159 million or by 0.9 per cent, from Rs17,185
million at the end of March 2001 to Rs17,344 million at the end of April 2001.
Net credit to Government from Bank of Mauritius dropped by Rs174 million or by
11.4 per cent, from Rs1,526 million to Rs1,352 million. Net credit to
Government from commercial banks increased by Rs334 million or by 2.1 per cent,
from Rs15,658 million to Rs15,992 million.
Credit to
the private sector from commercial banks went up by Rs2,841 million or by 4.0
per cent, from Rs71,824 million at the end of March 2001 to Rs74,665 million at
the end of April 2001. Additional credit was granted to "Sugar
Industry" (Rs684 million), "Hotels" (Rs571 million),
"Manufacturing " (Rs457 million), "Traders" (Rs186 million)
and "Personal & Professional" (Rs164 million).
Money
supply M2 went up by Rs150 million or by 0.2 per cent, from Rs96,468 million at
the end of March 2001 to Rs96,618 million at the end of April 2001. Narrow
money supply, one of the components of M2, fell by Rs117 million or by 1.0 per
cent, from Rs12,302 million to Rs12,185 million. Quasi-money, the other
component of M2, rose by Rs267 million or by 0.3 per cent, from Rs84,166
million to Rs84,433 million.
The level
of reserve money rose by Rs199 million or by 1.9 per cent, from Rs10,744
million at the end of March 2001 to Rs10,943 million at the end of April 2001.
Taking into consideration
liquidity conditions in the market, the Bank carried out seven variable-yield
repo transactions and two fixed-yield repo transactions with commercial banks
in May 2001 for periods varying from 2 to 3 days. The lowest yield for the
variable-yield repo transactions was 8.45 per cent while the two fixed-yield
repo transactions were carried out at 8.00 per cent.
Mauritius
Automated Clearing and Settlement System(MACSS)
The
number of transactions routed through the Mauritius Automated Clearing and
Settlement System (MACSS) in May 2001 was 2,546, involving a total amount of
Rs31,670 million, compared to 2,210 transactions for a total amount of Rs28,209
million in April 2001. The average number of transactions routed daily through
the MACSS increased to 116 in May 2001 from 105 in April 2001. The average
daily value of transactions also went up from Rs1,343 million in April 2001 to
Rs1,440 million in May 2001.
Between
end-June 2000 and end-April 2001, the number of Automated Teller Machines
(ATMs) in operation in Mauritius increased by 12 from 221 to 233 and the number
of cardholders (that is to say the number of cards in circulation) went up by
66,984 from 610,849 to 677,833. The
number of transactions involving the use of credit cards, debit cards, ATMs and
Merchant Points of Sale increased from 1.416 million in June 2000 to 1.681
million in April 2001. The value of
such transactions increased from Rs1,998 million to Rs2,606 million over
that period. Outstanding advances on
credit cards rose from Rs536 million to Rs635 million during the same period.
On
the international foreign exchange market, during May 2001 the US dollar
appreciated on average against the euro and Pound sterling but depreciated
vis-à-vis the Japanese yen. On 15 May
2001, as widely expected, the Federal Reserve at its FOMC meeting cut the
federal funds rate by 50 basis points to 4.0 per cent, boosting expectations
that the US economy would rebound in a convincing manner in the long term. In its accompanying statement, the Federal
Reserve signalled further rate cuts if needed.
The
euro, which opened May 2001 at an intra-month high of US$0.8953, faced
consistent selling pressure throughout the month. The single currency suffered a major setback when the ECB, on 10
May 2001, surprised financial markets by reducing its key refinancing rate by
25 basis points to 4.50 per cent. This
move turned market sentiment against the euro as currency traders questioned
ECB’s apparent volte-face in its interest rate policy when recently it had been
strongly defending its ‘wait-and-see’ stance.
Renewed market concerns over both growth and inflation data for Germany,
the euro zone’s largest economy, led to further falls in the single currency,
which closed May 2001 at an intra-month low of US$0.8529.
The Pound sterling, which started the month at US$1.4365, lost ground against the US dollar to close May 2001 at US$1.4244. The Pound’s losses against the US currency were, however, limited due to the release of UK economic data which highlighted the resilience of the British economy in the face of the global slowdown. As widely expected, the Bank of England cut its key repo rate by 25 basis points to 5.25 per cent at its monthly Monetary Policy Committee meeting on 10 May 2001.
The
Japanese yen managed to recover against the US dollar, indirectly supported by
heavy euro selling for yen by Japanese investors. Comments from IMF Managing Director that a weak yen was not the
way for Japan to overcome its economic difficulties also helped to prop up the
yen.
Direct
sales of foreign currencies by the Mauritius Sugar Syndicate (MSS) to the
banking sector during May 2001 amounted to an equivalent of US$4.1
million. The Bank of Mauritius
intervened on the interbank foreign exchange market selling a total amount of
US$14.5 million in May 2001.
Reflecting
international trends and local market conditions, the rupee, on average,
depreciated between April 2001 and May 2001 against the Pound sterling, US
dollar and Japanese yen by 0.6 per cent, 1.1 per cent and 2.8 per cent,
respectively. It, however, appreciated
against the euro by 0.8 per cent.
During May 2001, the rupee maintained its downward trend against the US
dollar to trade at an average rate of Rs28.809 compared with an average rate of
Rs28.481 in April 2001. The rupee went
down against the Pound sterling to trade at an average rate of Rs41.130 in May
2001 as against an average rate of Rs40.889 in April 2001. The rupee also weakened against the Japanese
yen to trade at an average rate of Rs23.732 per 100 Yen in May 2001 compared
with an average rate of Rs23.076 per 100 Yen in April 2001. The rupee, however, gained ground vis-à-vis
the euro, trading at an average rate of Rs25.244 in May 2001 compared with an
average rate of Rs25.448 in April 2001.
On
an average basis, between January 1999 and May 2001, the South African rand,
Philippines peso, Indonesian rupiah, Thailand baht, Mauritian rupee, Korean
won, Singapore dollar, Taiwan dollar and Hong Kong dollar all appreciated
against the euro by 2.5 per cent, 3.4 per cent, 5.2 per cent, 10.0 per cent,
14.8 per cent, 24.0 per cent, 26.7 per cent, 29.4 per cent and 35.2 per cent,
respectively.
The
foreign exchange reserves of the Bank of Mauritius decreased by Rs302 million,
from Rs21,679 million at the end of April 2001 to
Rs21,377 million at the end of May 2001.
The
net international reserves of the country, made up of the net foreign assets of
the banking system, the foreign assets of the Government and the country’s
Reserve Position in the International Monetary Fund (IMF), decreased by Rs1,584
million, from Rs30,641 million at the end of March 2001 to Rs29,057 million at
the end of April 2001. The end-April
2001 level of net international reserves of the country represented 27.6 weeks
of imports, down from 29.1 weeks at the end of March 2001.