(Published in Le Mauricien, Dec 1999)
There has been three exposé in the press on the present foreign exchange situation-from the two ex-finance Ministers, Messrs Sithanen and Bheerfick and from the incumbent, Mr Bunwaree. Let me try to dissect these explanations to single out the wheat from the chaff.
The recent measure by the Bank of Mauritius (BOM) of an upper limit of 70% in the credit to deposit ratio of commercial banks is an attempt by the monetary authorities to regain control of the money market after a too rapid relaxation of the quantitative controls in July 1997. It also reasserts the determination of BOM, since October 1998, to reorient monetary policy towards the exclusive goal of curtailing inflation.