Annual Economic and Financial Review -December 2018

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Eastern Caribbean Central Bank

M O N T S E R R A T

Overview

Economic activity in Montserrat is

estimated to have expanded in 2018 with

real output growing by 1.6 per cen

t 8

2018, in contrast to a decline of 2.8 per cent

in 2017.

The expansion in real GDP reflected

positive contributions from two key sectors;

namely construction and hotels and

restaurants. The consumer price index rose

by 2.4 per cent, on an end of period basis.

The central government recorded an overall

deficit, which was largely due to an increase

in recurrent expenditure. In the banking

system, domestic credit, total monetary

liabilities and net foreign assets increased.

In keeping with international standards, the ECCB updated the terminology used to describe economic activity in the

ECCU. Accordingly, the Bank now reports real change in the economy using real Gross Domestic Product (GDP) at

market prices and not Gross Value Added (GVA) at basic prices as used in previous reports of the Annual Economic and

Financial Review (AEFR). However, GVA will remain applicable for output by sector.

Overall, liquidity conditions remained

relatively stable and high, while non-

performing loans declined.

The outlook for the economy in 2019 is

favourable as economic growth is expected

to continue.

This projection is premised on

positive developments from the major

contributing sectors, which include

construction and hotels and restaurants. The

expansion of economic activity in these key

sectors is expected to have positive spillover

effects on the performance of allied sectors

such as transport, storage and communications

and the real estate, renting and business