cbn statement, 2012-05-22
The key concerns noted by the Committee were: 1. Slowdown in global economic activities, particularly, in the US, Europe and China 2. Slowdown in domestic output, especially, sharp decline in agricultural output and oil and gas sectors 3. Possible softening of crude oil prices in international markets with potential fiscal revenue loses and the likely pressure on the foreign exchange market and exchange rate 4. The inflationary threat that has re-surfaced in the first quarter of 2012, after having moderated in the fourth quarter of 2011 5. Imminent increase in electricity tariff which may lead to inflationary pressures 6. High interest rates in the face of declining GDP output; and 7. Security concerns in the country 8. Slow pace of structural reforms induced by failure to improve power supply, establish and implement reliable PPP framework that can attract funding for infrastructure, and delay in passing the PIB.
Sentiment: neutral
Topic: mp_economic_activity