Willemstad/Philipsburg:--- On June 18, 2026, the Centrale Bank van Curaçao en Sint Maarten (CBCS) decided to maintain its monetary policy stance unchanged. This decision reflects two considerations. On the one hand, the monetary union continues to benefit from a strong external position, with gross official reserves providing more than five months of import coverage. On the other hand, the ongoing uncertainty surrounding developments in the Middle East and their potential spillover effects on commodity and financial markets, as well as resulting implications for the monetary union, warrant a cautious approach. Given these divergent developments, the decision is to remain consistent with the U.S. Federal Reserve's (Fed) June decision to maintain the target range for the federal funds rate unchanged. In the current environment, the CBCS will continue to closely monitor domestic and international developments and will adjust its monetary policy stance if necessary.
Despite a more challenging global landscape and increased market volatility, gross official reserves have continued to increase strongly in 2026. Following a rise of Cg 402.4 million in 2025, gross official reserves further increased by Cg 485.0 million through June 1st, 2026. As a result, import coverage has remained comfortably above the three-month benchmark, reaching 5.5 months by the end of May 2026. The external position is expected to remain solid throughout the remainder of the year, with the import coverage projected at 5.3 months at year-end and gross official reserves expected to increase by Cg 302.2 million over the course of 2026.
Notwithstanding the monetary union’s solid external position, the outlook remains subject to substantial risks, particularly on the external front. The conflict in the Middle East continues to pose risks to global supply chains and trade routes, leading not only to higher energy prices but also, potentially, to increased insurance premiums and freight costs. Although the recently announced framework agreement between the United States and Iran may reduce these risks and result in lower-than-anticipated average oil prices, the situation remains fragile and uncertain. In an environment of elevated geopolitical risks, international oil prices could remain high for an extended period, increasing the monetary union’s import bill and exerting pressure on gross official reserves through higher foreign exchange outflows.
In addition to developments in the Middle East, ongoing geopolitical tensions, including the war in Ukraine, continue to contribute to global uncertainty. Furthermore, uncertainty surrounding global trade policies, with ongoing tariff disputes and legal challenges, reduces predictability and weighs on investment and economic activity. At the same time, renewed inflationary pressures stemming from higher commodity prices could prolong restrictive monetary policy in the United States, with potential repercussions for global financial conditions and economic growth.
These risks warrant a cautious monetary policy stance and support maintaining the CBCS's policy in line with the Fed's, given the peg of the Caribbean guilder to the U.S. dollar. On June 17, 2026, the Fed left its target range for the federal funds rate unchanged at 3.50% to 3.75%, citing persistent inflationary pressures and heightened uncertainty surrounding the economic outlook. Against this backdrop, the CBCS decided to keep its pledging rate unchanged at 4.25%, thereby maintaining a spread of 50 basis points above the federal funds rate.
Finally, the CBCS maintained the reserve requirement percentage at 18.50%, given the persistent excess liquidity in the banking system. It will also continue to offer attractive rates on its weekly auctions of certificates of deposit (CDs) to encourage banks to retain excess liquidity domestically, thereby safeguarding the monetary union’s foreign exchange position. These policy decisions are supported by the monetary union’s solid foreign exchange position and reflect a prudent, forward-looking approach in an uncertain global environment.
Willemstad, June 19, 2026
CENTRALE BANK VAN CURACAO EN SINT MAARTEN
PHILIPSBURG:--- Sint Maartener Dejon Daly, a student at the Breda University of Applied Sciences, submitted his final thesis to the Ministry of VROMI, concluding his six-month internship.
PHILIPSBURG (DCOMM):--- The Ministry of General Affairs' Office of Disaster Management (ODM) is calling on contractors, builders, developers, and trenching and excavation companies to ensure that comprehensive storm-ready plans are in place for the 2026 Atlantic Hurricane Season.
PHILIPSBURG:--- The EYoung Talent Fund (EYT FoN), established by EY Dutch Caribbean as part of its broader community impact initiatives alongside EY Cares and managed by the Cultuurfonds Caribisch Gebied (CCG), has officially expanded its reach to Sint Maarten and has awarded its first financial contribution on the island to Shanelle Kemoya Bucknor, a talented young dancer at NIA who has been accepted into the internationally renowned Alvin Ailey School in New York.
