The Central Bank of Samoa (CBS) has issued a warning about rising inflation, attributing it to higher international oil prices. However, the CBS Governor, Maiava Atalina Ainuu-Enari, reassures that this increase is temporary and will not persist beyond the next year. This statement comes after the CBS Board of Directors decided to maintain Samoa's monetary policy unchanged during their meeting on Tuesday. The CBS predicts inflation to rise from 1.0% in May 2026 to 3.8% by June 2027, slightly surpassing the Bank's medium-term target of 3.0%. This projected increase is primarily due to the conflict between the United States and Iran, which has led to higher global oil prices. Yet, the CBS remains confident that inflation will return to below the 3.0% target in the subsequent financial year. The Bank's decision to uphold current monetary policy settings is a strategic move to balance price stability and economic growth, ensuring that the Samoan economy continues to thrive. The CBS will continue to employ monetary policy tools, including open market operations, to maintain price stability and manage excess cash in the banking system. The Samoan economy is projected to grow by 2.7% over the next financial year, supported by increased government spending, remittances, and tourism. Foreign exchange reserves are expected to remain at around SAT$1.7 billion, providing Samoa with a robust buffer against external shocks. The CBS Governor emphasizes that the priority remains to maintain low and stable inflation, preserve confidence in the financial system, and support sustainable economic growth for the people of Samoa. This proactive approach by the CBS demonstrates a commitment to safeguarding Samoa's economic stability and resilience in the face of global challenges.
