## Monetary Operations and Liquidity Dynamics in Fiji

_Selected Issues Papers, June 23, 2026_

## Source details

**Canonical URL:** [Monetary Operations and Liquidity Dynamics in Fiji](https://www.imf.org/en/publications/selected-issues-papers/issues/2026/06/23/monetary-operations-and-liquidity-dynamics-in-fiji-577196)

## Other formats

- [Markdown version](/en/publications/selected-issues-papers/issues/2026/06/23/monetary-operations-and-liquidity-dynamics-in-fiji-577196/index.md)
- [Structured JSON version](/en/publications/selected-issues-papers/issues/2026/06/23/monetary-operations-and-liquidity-dynamics-in-fiji-577196/index.json)
- [Bundle manifest](/en/publications/selected-issues-papers/issues/2026/06/23/monetary-operations-and-liquidity-dynamics-in-fiji-577196/bundle-manifest.json)

## Bibliographic details
- Authors: Sandra Milena Benitez Celis, Matteo Ghilardi, Shivneel Kirpal
- Published: June 23, 2026
- Series: Selected Issues Papers
- DOI: https://doi.org/10.5089/9798229052306.018

---

### Summary
- This paper examines the implementation of monetary policy in Fiji, with a focus on liquidity dynamics and their implications for monetary transmission.
- It documents how persistent surplus liquidity—shaped by foreign exchange inflows and fiscal cash-management practices—has influenced the transmission of the policy rate and short-term money-market conditions.
- It assesses how liquidity conditions have interacted with the existing operational framework and discusses options to strengthen monetary implementation and transmission.

### Key findings on liquidity dynamics and monetary transmission
- Persistent surplus liquidity has been a defining feature of Fiji's money market.
- Surplus liquidity has been shaped by:
  - foreign exchange inflows
  - fiscal cash-management practices
- Effects documented:
  - Influence on the transmission of the policy rate.
  - Impact on short-term money-market conditions.
- Interaction between liquidity conditions and the existing operational framework has affected monetary implementation.

### Policy options and recommendations (themes discussed)
- Options to strengthen monetary implementation and transmission are discussed, focusing on:
  - improvements to the operational framework to better manage surplus liquidity
  - adjustments to liquidity management practices to enhance the pass-through of the policy rate
  - consideration of measures addressing the drivers of surplus liquidity, including foreign exchange inflows and fiscal cash-management

---

## Content in this bundle

- **Monetary Operations and Liquidity Dynamics in Fiji**
  - [Monetary Operations and Liquidity Dynamics in Fiji (Markdown version)](/-/media/files/publications/selected-issues-papers/2026/english/sipea2026052.pdf.md){rel="alternate" type="text/markdown"}
  - [Monetary Operations and Liquidity Dynamics in Fiji (PDF)](/-/media/files/publications/selected-issues-papers/2026/english/sipea2026052.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/selected-issues-papers/issues/2026/06/23/monetary-operations-and-liquidity-dynamics-in-fiji-577196_