The Bank of the Republic of Haiti’s Note on Monetary Policy (BRH) analyzes recent developments in the Haitian economy. Its objective is to provide information on the direction of monetary policy and the latest decisions taken by the authorities in order to identify short-term prospects for the national economy.

Excerpts from the BRH Report (March 2017) :

“[…] At the national level, the macroeconomic situation in the first quarter was marked by a slowdown in activity, as reflected by the decline in the growth of the Economic Activity Indicator (ICAE ). Indeed, it moved d from 1.6% in the last quarter of fiscal year 2016 (July-September 2016) to 0.6% in the first quarter of the current fiscal year (October-December 2016). Although data are not yet available for the second quarter (January-March 2017), the available information does not suggest a trend reversal.

[…] In the second quarter of fiscal 2017, preliminary data compared to the same period in fiscal year 2016 indicate an increase in the trade deficit, growth in transfers without counterpart and a slowdown in the depreciation of the gourde.

Available data on trade in goods between Haiti and the rest of the world show imports of US $ 845.3 million in the second quarter of 2016-2017, an increase of 22.93% compared to the second quarter of the previous year. This increase is attributable to the increase in the oil bill, which increased by 64.30% over the same period to 145.92 million US dollars for the quarter. On the export side, data available up to February 2017 show US $ 138.51 million for the first two months of the quarter, reflecting relative stability compared to exports during the months of January and February 2016 (-0.98%).

The rise in the oil bill combined with the stability of exports suggests an increase in the trade deficit in the second quarter on a year-over-year basis. In addition, for the months of January and February 2017, private transfers received from abroad amounted to US $ 277.32 million, up 7.40% from the same months of 2016. This growth of transfers combined with BRH interventions on the foreign exchange market contributed to supply the offer of foreign currency, thereby easing the strong pressure on the foreign exchange market during the same period of 2016. As at 31 March 2017, the BRH reference rate is estimated at 69,35 gourdes per US dollar, an increase of 2.91% compared to 31 December 2016. Despite the fact that this depreciation is slightly higher than in the first quarter (1.81%), it remains well below the increase in the exchange rate during the second quarter of fiscal year 2016 (8.93%).

With respect to public finances, revenues totaled 34,494.5 MG as of March 31, 2017, or 45% of the budget target of 76,647.7 MG. At that date, the average perception was 5,749.1 MG compared to a monthly forecast of 6,387.3 MG, a negative performance of 638.2 MG. Expenditure amounted to 48,818.1 MG in the first half of the year, compared to a budget estimate of 81,767.5 MG, corresponding to a realization of 59.7%. Their monthly average execution amounted to 8 136.4 MG compared to 6 814 MG programmed, ie an overspending of expenditure possibilities of 1 322,4 MG. This evolution of the public accounts led to a monetary financing of 2,234.5 MG against a target of 3,535.3 MG for the financial year.

[…] PERSPECTIVES
Despite the establishment of a new government, major economic and financial operators continue to display a certain wait-and-see attitude, which is likely to affect the development of the real sector in 2017. Apart from the foreseeable impact of the Hurricane Matthew on GDP this wait-and-see attitude is an unfavorable factor for job creation and foreign direct investment. However, the outlook for the Haitian economy is expected to converge in the coming quarters of 2016- 2017, towards a slowdown in the rate of depreciation of the gourde and a reduction in inflationary pressures in the economy […]”

Download BRH’s full report : http://www.haitilibre.com/docs/note_polmon2t17.pdf

HL/ HaitiLibre