REVIEW OF THE ECONOMY 2013
49
SUSTAINING GROWTH, SECURING PROSPERITY
MONETARY CONDITIONS
Given weak economic growth, the monetary
policy stance of the Central Bank of Trinidad
and Tobago continued to be accommodative
over the 9-month period October 2012 to June
2013. Inflationary pressures have moderated
despite the build-up in liquidity in the financial
system. Over this period, the focus of monetary
policy has been to stimulate economic activity.
In this context, the Repo Rate was reduced from
3.0 percent in August 2012 to 2.75 percent in
September 2012 where it has been maintained
up to June 2013. Consequently, commercial
banks reduced their prime lending rates as
well as the rates on new and outstanding loans.
Short-term interest rates remained at record low
levels throughout 2012 into the second quarter
of calendar 2013.
THE MONETARY SECTOR
Monetary Conditions
Central Bank Operations
Financial Sector Performance
Regulatory Developments
CENTRAL BANK OPERATIONS
EXCHANGE RATES/FOREIGN
EXCHANGE MARKET
The local foreign exchange market featured a
lower level of trading activity during the period
October 2012 to June 2013 when compared
to the similar period a year earlier. Net sales of
foreign exchange by Authorised Dealers which
amounted to US$1,001.2 million during the
nine-month period October 2012 to June 2013
were 25.7 percent lower than the amount sold
in the previous comparative nine-month period
ending June 2012.
The demand for foreign exchange originated
mainly from the retail and distribution sector
of the economy as well as from borrowing via
international credit cards which accounted for
THE MONETARY SECTOR
