In its communique following the Bank's 53rd meeting at the Bay Gardens Hotel in St. Lucia last Friday increases in economic activity were observed in all member countries with the exception of Montserrat.

"Growth of 3.6 percent was driven by expansions in the construction, hotel and restaurant, wholesale and retail trade and transport sectors,” said the Statement, which noted however, that output in the agricultural and manufacturing sectors declined primarily as a result of damage done by Hurricane Ivan.

Monetary Council members welcomed the continuing expansion in economic activity in the ECCU in the first quarter of 2005, which was in line with the expansion in the global economy. However, they cautioned that while the short-term outlook continued to be favourable, growth in the ECCU was subject to the risks and uncertainties in the global economy, including the rising oil prices.

The Council also noted that monetary conditions in the ECCU were generally favourable during the first four months of 2005, with growth in the money supply and an increase in the net foreign assets of the banking system. It said that the liquidity of the banking sector remained strong and interest rates remained stable.

The Council decided to maintain the officially administered rates with the regulated minimum rate of interest on savings deposits, at 3.0 percent; but agreed to review this rate at the October meeting of the Monetary Council and the Central Bank’s discount rate, at 6.5 percent.

The Council also reviewed the measures being taken by the ECCB to achieve financial sector stability. The members agreed to facilitate the passage of the outstanding financial legislation and regulation. Council affirmed the position that financial legislation in the currency union would be drafted and made on a uniform basis.