Brunei Darussalam: Selected Issues
IMF Staff Country Reports, September 24, 2024
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Bibliographic details
- Published: September 24, 2024
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400289071.002
Summary findings
- Inflation in Brunei Darussalam has been on a downward trend since September 2022, and was the first among regional peers to hit disinflationary territory post-coronavirus disease.
- An augmented Phillips curve model of inflation with global variables is employed to analyze drivers of inflation.
- Estimation indicates the rather sudden decline in inflation over recent quarters is driven primarily by supply factors, more specifically global supply chain developments, with moderate impacts from demand-side factors.
- Based on these findings, the paper motivates a conservative near-term inflation outlook of 1.3 percent for 2024, noting that global supply chain disruption is prone to substantial uncertainty and always evolving.
Methodology and analytical focus
- Model: Augmented Phillips curve model of inflation with global variables.
- Analytical approach: Examination of demand-side and supply-side factors to assess their relative importance for inflation dynamics in Brunei Darussalam.
- Key emphasis: Role of global supply chain developments as a supply-side determinant of domestic inflation movements.
Key projections and policy implications
- Near-term inflation outlook: 1.3 percent for 2024.
- Policy implication: Conservative inflation outlook and policy attention on supply-side developments, given substantial uncertainty in global supply chains.
- Interpretation: Moderate demand-side effects complement dominant supply-side influences in recent inflation decline.
Subjects and keywords
- Subjects: Domestic credit, Inflation, International trade, Macrostructural analysis, Money, Prices, Revenue administration, Structural reforms, Trade barriers, Trade facilitation.
- Keywords: baseline forecast, digitizing Trade facilitation, Domestic credit, g deficit path, Global, Inflation, PIH analysis, Structural reforms, Trade barriers, Trade facilitation, Trade openness, transition scenario.
Source: https://www.imf.org/en/publications/cr/issues/2024/09/24/brunei-darussalam-selected-issues-555556
Content in this bundle
- Brunei Darussalam: Selected Issues; IMF Country Report No. 24/302; August 20, 2024