NASSAU, Bahamas — Banking sector liquidity in The Bahamas surged in May, with excess reserves climbing by $44.1 million to nearly $2 billion as deposit growth outpaced lending—marking a significant turnaround from the $32.6 million contraction recorded a year earlier.
The Central Bank’s latest monetary sector data showed that broader liquidity, captured by excess liquid assets, also expanded by $33.5 million to $3.18 billion—reversing a $6.2 million decline in May 2024.
The liquidity boost comes even as external reserves declined by $24 million to $2.8 billion, extending a downward trend from the same month last year. The decrease was largely driven by an uptick in the Central Bank’s net foreign currency sales to the public sector, which rose to $45.1 million from $24.7 million in May 2024. However, net foreign currency purchases from commercial banks improved modestly to $19.3 million, while commercial banks themselves shifted to a net foreign currency intake of $26.6 million—bouncing back from a net outflow of $34 million last year.
Foreign exchange outflows for current account transactions also eased. Total sales dropped by $21.2 million year-on-year to $592 million in May. The decline was led by a $24.5 million fall in factor income remittances, along with decreases in travel expenses and oil imports. Conversely, transfer payments, non-oil imports, and card-related transactions saw slight increases.
