InvestMacro

By CentralBankNews.info
Sri Lanka’s central bank maintained its accommodative monetary policy stance and key interest rates, as expected, saying the measures it had taken in recent months were being transmitted to the economy and domestic economic activity is expected to gradually revive while inflation should remain within the desired range.
The Central Bank of Sri Lanka (CBS) has lowered its key interest rates by 100 basis points this year following cuts in May and August, and lowered the reserve requirements for banks by 250 points since November 2018, helping boost liquidity.
CBS’s Standing Deposit Facility Rate (SDFR) now stands at 7.0 percent and the Standing Lending Facility Rate (SLFR) stands at 8.0 percent.
While taking note of fiscal slippages, the central bank’s monetary board said recent tax revisions would support lower inflation and higher economic growth in the short term, but greater clarity with regard to the government’s fiscal path is required to assess the impact on the economy.
The decision to maintain rates was widely expected following the recent Nov. 16 election of Gotabaya Rajapaksa as president of Sri Lanka, and Indrajit Coomaraswamy’s decision on Nov. 26 to step down as governor of the central bank on Dec. 20.
Coomaraswamy, a Tamil,  joined CBS in 1974 and became governor in 2016 and said he was resigning for personal reasons and the age limit for staff at regulated entities.
“The decision of the Monetary Board is consistent with the aim of maintaining inflation in the desired 4-6 percent range while supporting economic growth to reach its potential over the medium term,” CBS said, adding monetary policy in several key economies has become increasingly accommodative “in view of the bleak global economic outlook.”
Sri Lanka’s economy is gradually recovering from the impact of the Easter Sunday suicide bombings, which killed more than 250 people, with the International Monetary Fund (IMF) forecasting growth to strengthen to 3.5 percent in 2020 from 2.7 percent this year as tourism gradually recovers, supported by government action to mitigate revenue shortfalls from the attacks.
Gross domestic product slowed to 1.6 percent year-on-year in the second quarter from 3.7 percent in the first quarter and CBS said growth is expected to be modest during the rest of this year but improving investor confidence supported by political stability and fiscal stimulus should boost domestic demand and drive economic growth in the short term.
Headline inflation has been volatile in recent months due to supply disruptions to food and inflation eased to 4.4 percent in November from 5.4 percent in October.
CBS expects continued volatility in inflation in the near term together with tax revisions and possible revisions to administered prices but still remain within the target range.
The rupee has been volatile in the immediate aftermath of the presidential election but is up 1.1 percent against the U.S. dollar this year, trading at 180.88 to the dollar today.

The Central Bank of Sri Lanka issued the following statement:

By CentralBankNews.info
Fiji’s central bank left its benchmark Overnight Policy Rate (OPR) steady at 0.5 percent, saying the current easy monetary policy stance remains appropriate as “accommodative macroeconomic policies are needed to raise growth whilst maintaining price and external stability.”
The Reserve Bank of Fiji (RBF), which has not changed its rate since October 2011, said its monetary policy objectives, which include adequate foreign exchange reserves and price stability, remain intact and its current accommodative policy stance is supported by surplus bank liquidity of more than $600 million at the end of November.
Earlier this month RBF slashed its forecast for economic growth this year to 1.0 percent, the slowest growth rate in a decade, from May’s forecast of 2.7 percent and down from 3.5 percent in 2018.
In today’s statement, Ariff Ali, governor and chairman of RBF, said aggregate demand had softened as expected and private sector credit growth had slowed further in October.
Data for the first 9 months of the year show demand was weakening due to weak business and investor sentiment as well as lower government spending, with most business sectors expected to decelerate, RBF said on Nov. 7.
On the upside, commercial banks’ profitability has improved, visitor arrivals are up along with the fishing sector and education, health and information and communications sectors.
Growth in 2020 is expected to pick up to 1.7 percent as both domestic and global economic sentiments are expected to improve, with growth in 2021 seen rising to 2.9 percent and then to 3.0 percent in 2022.
The growth in tourism and remittances is underpinning stable foreign reserves but inflation turned negative in October, falling to minus 0.9 percent from a positive 0.4 percent in September, the first deflation since November 2014, with prices declining in all major categories.
“Given that aggregate demand is forecast to remain soft, demand side inflationary pressures are forecast to be broadly muted in the near-term,” RBF said.
Fiji’s foreign reserves amounted to $2.190 billion at the end of November, enough to cover 5 months of imports, and are forecast to remain at comfortable levels in the medium term.

The Reserve Bank of Fiji issued the following statement:

www.CentralBankNews.info

By Orbex

Gold

The yellow metal has been lower over the course of this week’s trading as better risk sentiment has seen diminished safe-haven flows. Gold prices have been trending lower for a few weeks now as expectations of a US/China trade deal have been ramped up in response to recent comments. Last week, President Trump said that a trade deal was “potentially very close”. This week, Trump added further to these comments saying that the two sides are now in the very “final throes” of completing the phase-one trade deal agreed in October.

The market has been waiting on a signing date following the cancellation of the APEC meeting which was to host the deal signing. While the market is yet to receive an official signing date, the momentum in recent comments from both sides has seen an increase in expectations that a deal will be coming in the next few weeks. In terms of a date, the market is expecting that a deal will be signed before December 15^th which is the date the US has penned for the next round of trade tariffs on China.

If the two sides do sign a deal ahead of this date, the implications for gold will be heavily bearish as we will likely see a strong spell of risk-on trading. Equities prices have been trading higher into record levels over recent weeks, which has kept the pressure on gold. This theme is likely to continue if a deal is signed. Of course, if a deal does not come ahead of the December 15^th date and the US does announce new tariffs, upside in equities will likely reverse quickly, seeing gold supported.

Technical Perspective

Gold prices continue to trade lower within the bearish channel which has framed the correction off year-to-date highs. The recent 1481.93 level, which has underpinned gold prices over the last three months, has now been broken. Focus is now on a test of the 1436.19 level next.

For now, the pattern can still be viewed as a corrective bull flag suggesting that upside could still materialize. If the price can break back above the1481.93 level, the key level to watch in the short term is 1522.75. This is a major long-term pivot for gold. Above here, the focus will be on a move back up to the recent 1554.69 level.

Silver

Silver prices have broken from their recent correlation with gold to trade higher across the week. On the back of the heavy sell-off seen last week, silver this week posted a mild recovery as the rally in equities leaned support. Expectations of a US/China trade are also helping support silver here due to expectations of increased industrial demand.

The outlook for the US dollar is important here also. The painting back of Fed easing expectations has seen USD supported over recent weeks which has offset some of the upside in silver.

Technical Perspective

The recent breakdown in silver has seen price breaking down below the key 17.3408 level as the bearish channel develops further. While this channel can still be viewed as a corrective bull flag structure, for now, bulls will need to see price quickly back above that broken support.

Below 17.3408, the next major support level is down at 16.2130. This also holds the retest of the broken long term bearish trend line. To the topside, the 18.6397 level remains the key marker to break.

By Orbex

By Orbex

This is an important question to consider when evaluating whether to sign up for a particular Forex broker in.

Not only can it impact your potential FX trading success, but it can also give you clues about how reputable the broker is.

There are certain charging practices among Forex brokers that you definitely want to avoid.

How Brokers Make Money

Before discussing how much you can expect to pay a Forex broker, let’s go over how they are supposed to make money.

Brokers give you access to the Forex markets, and usually, there are two ways that they can charge you for this service. One is through fixed commissions, and the other is through the spread.

Typically, banks charge commissions, while online brokers charge spreads.

Why is spread preferable to commissions? Well, the spread represents a difference in the buy and sell price, and in most forex operations it is really small. A fraction of a percent, in fact. This gives the Forex trader a lot more flexibility in picking their trade size because they always know at the time of trading how much it will cost.

Most importantly, the Forex broker only makes money if you trade. This means they are motivated to make sure you stick around and make money. And because the broker isn’t taking a percentage of your trading income, they have no motivation to interfere in the way you trade.

What Kind of Spreads Can You Expect?

How much the spread is, usually depends on the size of your account, and varies from broker to broker.

It also varies over time, depending on market circumstances, and how much liquidity there is. Brokers generally compete on the basis of offering smaller spreads, so there is an incentive for them to offer as low a spread is possible for their clients.

Most reputable Forex brokers who offer variable spreads automatically pass the lower spreads onto their clients in real-time.

Spreads vary between currencies, as well. The more popular – and therefore liquid – pairs typically have smaller spreads than the more exotic pairs. Pairs that have more volatility will also have larger spreads, generally.

Size Matters

Generally, for a small retail Forex trader with an account under $5,000, you should expect spreads of less than 2 pips for major currency pairs.

Exotic and crosses will likely have higher spreads, the less liquidity they have.

If you are a larger Forex trader, you can sign up for premium accounts that offer lower spreads, sometimes as low as 0.6 of a pip. This is more attractive for day traders, naturally, since they will be making more trades.

The Bottom Line

Reputable FX brokers will only charge spreads. Less reputable brokers usually introduce additional fees to get more money out of their customers, such as deposit and withdrawal fees, commissions, etc.

Usually, this is because they expect their customers to lose money, and not stay around for long. You’ll likely want a Forex broker that balances small spreads with good educational materials.

By Orbex

By Orbex

The US markets were closed on Thursday on account of the Thanksgiving holiday. Investors were cautious amid the lack of any major fundamentals during the day. Doubts on the US and China trade deal still remain. This comes as the Washington administration passed a bill in support of the Hong Kong protests. Chinese authorities are reportedly not happy with the US decision. Investors fear that this could spill over into the trade talks.

German Consumer Prices Fall More than Expected

The monthly consumer price index data for Germany showed that inflation was weaker in November. Headline CPI for Germany was down 0.8% on the month in November. This was more than the forecasts of a 0.5% decline estimates given by economists. On a year over year basis, German CPI is up 1.1% however but below the median estimates of a 1.3% increase. Lower energy prices were attributed to the weakness in the headline inflation.

EURUSD Holds on to Support Firmly

The common currency recovered from the slump on Wednesday, but price action is still near the support level of the 1.1000 region. With the US markets partly open today, we could expect to see a flat close into the weekend. The prospects of a rebound come into the picture only when EURUSD can breakout above the local pivot high of 1.1020.

Sterling Trades Flat as Tories Lead in UK Poll

The incumbent Prime Minister Johnson’s Conservative Party is expected to win with a majority in the upcoming December 12^th elections. The UK poll puts the Tories as the firm favorites despite the Labor party trailing closely. The sterling which fell earlier this week on news about the Labor party gaining ground erased the losses.

GBPUSD Back Within the Range

The currency pair is back trading within the range of 1.2960–1.2865. This sideways range could continue into the December 12^th elections. So far, the upper range of 1.2960 has held up. So further gains can be expected only on a strong close above this level. To the downside as well, unless the declines are followed up by strong momentum, price action could remain muted.

Gold Prices Stay Muted Despite Modest Risk Aversion

The precious metal attempted to make some modest gains during the European trading session. But by the US session, the precious metal gave back the gains. With thin trading, gold prices were somewhat limited in their range. The US markets open today but it is a short trading day for the US ahead of the weekend.

XAUUSD Trending Weaker

XAUUSD has been somewhat subdued but the bias remains to the downside. With price action within the range of 1462 and 1445 levels, the sideways range could remain in play. The bias can shift to the upside on a break out above 1462. However, the Stochastics oscillator is indicating to continued bearish momentum.

By Orbex

By CentralBankNews.info
South Korea’s central bank left its base rate steady at 1.25 percent and said it would maintain its accommodative monetary policy stance as domestic economic growth is expected to be moderate and inflation low, confirming it is still willing to “judge whether to adjust the degree of monetary policy accommodation.”
The Bank of Korea (BOK), which has cut its rate twice this year by a total of 50 basis points in October and July, said the pace of domestic economic growth has remained slow but next year the  sluggishness in exports and facilities investment is expected to ease and consumption growth to rise moderately although the adjustment in construction investment will continue.
BOK lowered its forecast for 2019 growth to around 2.0 percent from July’s forecast of 2.2 percent  and forecast 2.3 percent growth in 2020, down from 2.5 percent previously forecast. In 2018 the economy grew 2.7 percent.
“As it is expected that domestic economic growth will be moderate and it is forecast that inflationary pressures on the demand side will remain at a low level, the Board will maintain its accommodative monetary policy stance,” BOK said.
Whether to adjust the degree of accommodation, BOK said this would be decided in light of developments in U.S.-China trade talks, the economic and monetary policies of major countries, the rise in household debt, along with geopolitical risks and their impact on the domestic economy and financial stability.
South Korea’s economy, considered a bellwether for the global economy and trade due to its reliance on exports, grew 2.0 percent annually in the third and second quarters of this year.
Last month BOK Governor Lee Ju-yeol said higher tariffs and uncertainties from the U.S.-China trade war had probably cut South Korea’s growth by 0.4 percentage points in 2019.
Consumer price inflation rose slightly in October to zero percent from a decline of 0.4 percent in September and BOK forecast headline inflation would rise moderately to around 1.0 percent in 2020 while core inflation, which excludes food and energy, would be in the upper zero percent level.

The Bank of Korea issued the following statement:

By CentralBankNews.info
Angola’s central bank left its key interest rates unchanged, saying disinflation is continuing despite the implementation of value-added-tax (VAT) and the liberalization of the exchange rate in October.
The National Bank of Angola (BNA), which has cut its benchmark BNA rate by 100 points this year to 15.50 percent, added its monetary policy stance will remain restrictive through finer liquidity management by open market operations in order to consolidate the floating exchange rate regime and to ensure greater price stability.
In October BNA’s monetary policy committee raised the reserve requirement for kwanza deposits by 500 basis points to 22 percent and set a 10.0 percent interest rate for a new 7-day facility as it completed a transition to a market-determined exchange rate for the kwanza begun in January 2018.
This included scrapping a 2.0 percent trading band margin that had limited the kwanza’s move during currency auctions.
After taking over the reins of BNA in October 2017 – part of Angola President Joao Laurenco’s move to clean up the country’s image as corrupt –  Governor Jose Massano began a major overhaul of BNA in January 2018, including ditching a fixed exchange rate regime and adopting the monetary base as a operational variable to better control liquidity.
Continuing BNA’s policy of normalizing and reducing its intervention in the foreign exchange market, the bank today said it would stop purchasing foreign currency from oil companies as of Jan. 2, 2020 and in the future they should sell directly to commercial banks.
The limit on the foreign exchange position of commercial banks would also be lowered to 2.5 percent from 5.0 percent, with both measures aimed at raising the number of participants in the foreign exchange market and boosting the interbank foreign exchange market.
Since BNA began liberalizing the foreign exchange market by using auctions to set a reference rate in January last year, the kwanza has lost almost two-third of its value.
Today the kwanza was trading at 491.2 to the U.S. dollar, down 23 percent since October 1, 37 percent since the start of this year and down 66.2 percent since the pre-January 2018 peg of 166.
The monetary base expanded by 6.81 percent in October as compared to an 11.68 percent contraction in September, reflecting an increase in bank reserves by 8.24 percent, and bank notes and coins in circulation by 3.86 percent.
The M2 monetary aggregate, which comprises bank deposits, notes and coins, rose 2.97 percent in October while the stock of credit in local currency expanded 2.6 percent in October from September but on an annual basis credit stock was down 4.62 percent.
Angola’s inflation rate was steady at 16.08 percent in October and September, and in September Massano told Bloomberg inflation was expected to fall below 10 percent by 2022, providing scope for interest rates to fall.

www.CentralBankNews.info

By The Gold Report

Source: Adrian Day for Streetwise Reports   11/27/2019

Money manager Adrian Day looks at three junior resource companies whose stocks are down significantly in the past few months, and attributes some of this to tax-loss selling. He also lists a handful of companies he believes are best buys right now.

Vista Gold Corp. (VGZ:NYSE.MKT; VGZ:TSX, US$0.59) has published an updated prefeasibility study (PFS) on its Mt Todd project in the Northern Territories in Australia, the largest undeveloped gold project in that country. The revisions to the old PFS include updating both the gold price (upward to $1,350/ounce) and the Australian dollar (downward to US$0.70). Both of these revisions help boost the returns on the project, as did other improvements, including on gold recoveries. Using the sensitivity table for today’s prices, the project has a net present value (NPV, with 5% discount) of $1.15 billion and an international rate of return (IRR) of over 30%.

Mind the gap
These are very strong numbers. It should be noted, though, that any strengthening in the Australian dollar—and the Aussie dollar, as other “commodity currencies,” usually appreciates in a resource bull market—would affect costs negatively. For a company with a market capitalization of under $60 million and no debt, this is an enormous gap.

The question is, how do shareholders realize at least some of that value. Now that the updated PFS and metallurgical testing have been completed, the company is continuing to derisk the project and seek a development partner. Vista has made clear that the project is too big for a company its size to develop independently. Obviously, one does not want to give away a project such as this too cheaply. On the other hand, one cannot seek too high a price that others will not pay in the current market.

How much dilution?
If Vista is patient—or stubborn—in waiting for a better gold market and a great deal, then the second major question flowing from this is how much dilution Vista shareholders will have to take while we wait. Right now, following a $1.5 million installment payment for the de Los Reyes property, Vista has about $5.5 million in cash. Its corporate expenses for the next 12 months will run around $4 million, plus another $1–2 million in programs at Mt Todd. (The property expenditures will drop significantly following the completion of the updated PFS.) That means Vista has cash for just one year’s expenditures.

The next payment on the sale of de Los Reyes will be in October 2021. Vista also has used mill equipment for sale, on the books for $5 million; and shares in Midas Gold, currently valued at about $7 million. So Vista has options to extend the time when it will have to raise additional funds, but will likely need to do so at some point over the next year.

The potential for an additional raise, as well as tax-loss selling (fatigue), has caused the stock price to drop from highs over $1 per share in August to the current $0.59/share. Hold for now.

Lots of Smoke but No Fire. . .Yet

Midland Exploration Inc. (MD:TSX.V, 0.72 x 0.75) has provided several updates on its exploration activities recently, including at James Bay and the Abitibi, as well as specifically on the copper/molybdenum Mythril project. In sum, one can say that the company continues to see mineralization and develop new targets on multiple properties, but the truth is that there have been no spectacular results. At Mythril, specifically, there is lots of smoke but, as yet, no fire.

Mythril is a large and complex system. I am not sure there is a good understanding of the ore body yet, and it will take a lot of drilling to explore. Shareholder BHP Billiton Ltd. (BHP:NYSE; BHPLF:OTCPK) is providing assistance, such as with age-testing the rocks, and Midland is moving ahead with a new drill program on the 100%-owned property.

Seeking partners
Elsewhere, Midland is putting a renewed focus on generating new partnerships, which had slipped somewhat over the past year or more. The company has multiple projects available for partnerships, in gold and base metals. It has a strong technical team, operates in one of the best mining jurisdictions in the world (Quebec), and has a solid balance sheet, with around $12 million in cash.

It has already been hit by disappointment on initial drilling at Mythril—though there were rather unrealistic expectations for a quick discovery—followed by tax-loss selling (aggravated by some fatigue). The stock has dropped from over $1.20/share in the spring to the current level in the low-$0.70s. Though there could be further tax-loss selling, we would now look to buy on any weakness.

Another Roadblock for Almaden

Almaden Minerals Ltd. (AMM:TSX; AAU:NYSE, US$0.47) has hit yet another roadblock in its permitting for its Ixtaca project. The Mexican environmental authority that issues mining permits (SEMARNAT) has put the approval process for Almaden’s environmental impact statement (EIS) on hold, pending outcome of a lawsuit in which the company is named.

The lawsuit, filed by a U.S.-based non-governmental organization (NGO), is primarily against the Mexican government and relates to a permit for land that Almaden subsequently abandoned. (We have discussed this previously.) Moreover, SEMARNAT’s mandate is to review the EIS on its technical merits, and, equally importantly, the agency has a time limit on when a decision must be reached; it should have been delivered by very early in the new year.

The decision to suspend consideration of the permit could simply be related to the confusion in Mexico following the election. Ixtaca would be the first new project to receive final go-ahead and there may be some political hesitation. Others has suggested that the decision could simply be a protest by SEMARNAT against cuts in the agency’s budget.

Not good for Mexico
Either way, Almaden is a political football and has said it is “considering its options.” And either way, this sort of things is not improving Mexico’s reputation as an attractive mining destination. Following the change in administration, Mexico is under scrutiny already.

This latest blow in a series of setbacks, as well as overall fatigue means Almaden is experiencing tax-loss selling. The stock was trading at $0.75 in August, and over $0.65 immediately prior to this latest news. I suspect we may see even more selling waiting for Almaden’s response, so we are holding waiting for clarification on the environmental decision, or when tax-loss selling appears to have played out before looking to buy again.

Preparing for Tax-Loss Buying

Based on some of the comments above, it is clear that junior gold stocks are being hit by tax-loss selling. Indeed, other than some of the erstwhile high-flying social media stocks, and oil service companies, there are few areas as ripe for tax-loss selling as the junior resource sector. In general, we suspect there is more to come. But we are now on alert for good buys that have been hard hit by such selling and that may experience a bounce in the New Year.

Among best buys now: Altius Minerals Corp. (ALS:TSX.V, 10.69 x 10.83) ; Fortuna Silver Mines Inc. (FSM:NYSE; FVI:TSX; FVI:BVL; F4S:FSE, US$3.02); Lara Exploration Ltd. (LRA:TSX.V, 0.455 x 0.50), Evrim Resources Corp. (EVM:TSX.V, 0.26 x 0.295), and Kingsmen Creatives Ltd. (KMEN:SI, 0.455). Midland, above, can be bought now if you do not already own it. We expect several companies to reach buying levels in coming weeks.

Adrian Day, London-born and a graduate of the London School of Economics, heads the money management firm Adrian Day Asset Management, where he manages discretionary accounts in both global and resource areas. Day is also sub-adviser to the EuroPacific Gold Fund (EPGFX). His latest book is “Investing in Resources: How to Profit from the Outsized Potential and Avoid the Risks.”

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Disclosure:
1) Adrian Day: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: Evrim Resources, Midland Exploration, Altius Minerals and Lara Exploration. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. Funds controlled by Adrian Day Asset Management hold shares of the following companies mentioned in this article: Midland Exploration, Vista Gold, Almaden Minerals, Altius Minerals, Fortuna Silver Mines, Lara Exploration, Evrim Resources, Kingsmen Creatives. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Evrim Resources, Midland Exploration, Vista Gold, Almaden Minerals, Altius Minerals and Lara Exploration, companies mentioned in this article.

( Companies Mentioned: AMM:TSX; AAU:NYSE,
ALS:TSX.V,
EVM:TSX.V,
FSM:NYSE; FVI:TSX; FVI:BVL; F4S:FSE,
KMEN:SI,
LRA:TSX.V,
MD:TSX.V,
VGZ:NYSE.MKT; VGZ:TSX,
)

By CentralBankNews.info
Gambia’s central bank left its policy rate steady at 12.50 percent as inflation is has started to decelerate and is expected to continue to trend downwards as long as the exchange rate of the delasi remains stable.
The Central Bank of The Gambia (CBG) added an improving current account along with a comfortable level of international reserves continues to support a stable delasi while the fundamentals of the banking sector remain strong, underpinned by adequate capital, high liquidity, a low level of non-performing loans, robust credit expansion and profitability.
But among the major risks to the economy are shocks to agriculture and food supply from weather-related factors, the impact on tourism from the collapse of Thomas Cook, and high public debt, CBG said.
Gambia’s inflation rate decelerated to 7.5 percent in October from 7.6 percent in September but is still able 6.6 percent in October 2018.
Gambia’s economy grew 6.5 percent in 2018 from 4.8 percent in 2017, supported by tourism, trade, financial services, insurance, transport and telecommunications, and has been forecast to growth 5.4 percent this year.
“Growth is projected to remain robust in 2019,” CBG said, cautioning the collapse of Thomas Cook in September may affect tourism along with the impact of delayed rains on agricultural output.
Tourism accounts for some 30 percent of economic output in the former British colony of Gambia, with the Thomas Cook Group accounting for about 40 percent of annual visitors.
Some 57,000 British customers had already book hotels or seats on charter flights for Gambia for the season that typically starts in October, around one-quarter of all tourists to Gambia in 2018.
The delasi has depreciated since July, with the fall accelerating in October although it has bounced back in recent days and the CBG said the exchange rate “remains broadly stable.”
The delasi was trading at 51.13 to the U.S. dollar today, down 3.5 percent this year.

The Central Bank of The Gambia issued the following statement:

By IFCMarkets

Top Gainers – The World Market

1. Centrica plc is a British supplier of electricity and natural gas to consumers.

2. Coffee CFD on futures contract on Arabica.

 Top Losers – The World Market

1. ThyssenKrupp AG is a German steel production company.

2. Tesla Motors Inc. is an American manufacturer of electric vehicles and space technology.

 Top Gainers – Foreign Exchange Market (Forex)

1. USDTRY, USDPLN – an increase in these charts means the strengthening of the US dollar against the Turkish lira and the Polish zloty.

2. GBPJPY, GBPAUD – an increase in these charts indicates the weakening of the Australian dollar and Japanese yen against the British pound.

 Top Losers – Foreign Exchange Market (Forex)

1. USDSEK, EURSEK – a decrease in these charts means the weakening of the US dollar and euro against the Swedish krona.

2. EURHKD, EURZAR – a decrease in these charts indicates the weakening of the euro against the Hong Kong dollar and the South African rand.

Market Analysis provided by IFCMarkets

Note:
This overview has an informative and tutorial character and is published for free. All the data, included in the overview, are received from public sources, recognized as more or less reliable. Moreover, there is no guarantee that the indicated information is full and precise. Overviews are not updated. The whole information in each overview, including opinion, indicators, charts and anything else, is provided only for familiarization purposes and is not financial advice or а recommendation. The whole text and its any part, as well as the charts cannot be considered as an offer to make a deal with any asset. IFC Markets and its employees under any circumstances are not liable for any action taken by someone else during or after reading the overview.