Amigoe: Central Bank of Aruba is concerned

Amigoe; April 14, 2006: Central Bank of Aruba is concerned

ARUBA Ã¢â‚¬” The Central Bank of Aruba (CBA) is concerned about the developments of the international reserves. “Too high government expenses that lead to over-liquidity within the economy, continue to have a troubled negative effect on the balance of payments and thus on the position of the international reserve.” Also the acceleration of the inflation is very worrisome for the Bank.

In February, the price index figure for the family consumption was 4.6 percent higher than same month last year and with that, the inflation pace accelerated to a worrisome 3.7 percent, compared with 2.6 percent the year before. This inflation is 0.2 percent point higher than the average annual inflation in the United States, concludes the CBA.

There is no information yet on the number of stay over tourists, but the average occupancy of the hotels dropped with 1.5 percent points to 88 percent. The number of cruise passengers increased with 8.9 percent in February, despite the fact that the number of cruise ships did not change.

The net-supply of foreign exchange for the amount of 35.1 million florins caused by transfers of foreign bank accounts of the private sector, made the money quantity increase with 39.4 million florins in February of 2006. Because of this, the net foreign active increased to 602.4 million florins, which however is still 65.9 million florins or 9.9 percent lower than the year before. The net domestic active increased with 4.3 million florins in February, which was partly caused by an increase of the banking claims against the private sector of 8.5 million florins. Mortgages, consumer credits, and loans to businesses increased with respectively 3.7 million florins (0.5 percent), 3.1 million florins (0.6 percent) and 3 million florins (0.3 percent).

The banking claims against the government increased with 6.2 million florins. The banking claims not related to credits decreased with 10.4 million florins.