The Central Bank Of The Bahamas’ Contribution To The
2016-2017 Budget Communication
and the Chinese Yuan by 19.0%, 11.4%, 5.7% and 4.6%, respectively. In addition, the dollar
Annex A
inched-up versus the Swiss Franc by 0.8% and the Japanese Yen by 0.3%.
In the commodity markets, a combination of continued excess supply and softness in
consumer demand led to a 46.6% decline in the average price of crude oil to $52.61 per barrel
in 2015, while on a year-on-year basis, prices fell by 36.3% to $36.53 per barrel at endDecember. Similarly, the average cost of gold and silver decreased by 7.9% and 16.7% to
$1,153.50 and $15.55 per troy ounce, respectively. Further, food costs continued to trend
lower in 2015, with the United Nations’ Food and Agriculture Organization’s overall food price
index contracting by 18.7%, after the prior year’s 3.8% reduction, as the cereals index–which
includes wheat and maize–plunged by a further 15.4%, following a 12.5% decline in the previous
year.
The IMF in its April 2016 World Economic Outlook Report, projected that global
output will expand by 3.2% in 2016, marginally higher than the previous year’s 3.1% expansion,
with a further advance of 3.5% in 2017. Growth in advanced economies is expected to stabilize
at 1.9%, supported by central banks’ accommodative monetary policies and weak global oil
prices. In the United States, output growth is forecasted to steady at 2.4%, buoyed by sustained
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gains in consumer spending and an improving housing market, which should offset the fall in
2016/2017
DRAFT
ESTIMATES
OF REVENUE &
EXPENDITURE
1.5%, slightly lower than the 1.6% gain in the previous period, as several southern states
exports due to the rise in the value of the dollar. Euro area output is projected to increase by
continue to face severe fiscal challenges. In the United Kingdom, the economy is poised to
benefit from reduced energy costs and a robust housing market, which should offset headwinds
from fiscal consolidation. As a result, real GDP is forecasted to increase by 1.9%, albeit lower
than the 2.2% gain recorded in 2015. Growth in Japan is projected to hold steady at 0.5%, with
lower energy prices, fiscal stimulus measures and the BOJ’s quantitative easing policies providing
most of the impetus for growth.
Emerging market and developing economies are forecasted to collectively expand by
4.1% in 2016, slightly higher than the 4.0% gain recorded in the prior year. Growth in China is
projected to slow modestly by 20 basis points to 6.4%, reflecting continued softness in industrial
sector output, which should offset gains in the services sector and consumer spending. In
addition, India’s economy is forecasted to expand by 7.5% in 2016, extending the prior year’s
7.3% growth, on account of higher industrial activity, as well as gains in private consumption and
investment.
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