Sunday 8 December, 2019

BOJ sells US$40 million to authorised dealers to boost market supply

BOJ Governor, Richards Byles last month told Jamaicans that the central bank was not into the business of foreign exchange management. He also urged Jamaicans to get used to the fluctuations in the exchange rate.

BOJ Governor, Richards Byles last month told Jamaicans that the central bank was not into the business of foreign exchange management. He also urged Jamaicans to get used to the fluctuations in the exchange rate.

The Bank of Jamaica (BOJ) on Tuesday sold US$40 million to authorised dealers and cambios to boost supply in the market.

At the same time, the BOJ sought to allay the fears of Jamaicans about the rapid and continued depreciation of the Jamaica dollar against its United States counterpart.

BOJ Governor, Richards Byles last month told Jamaicans that the central bank was not into the business of foreign exchange management. He also urged Jamaicans to get used to the fluctuations in the exchange rate.

However, on Tuesday, the BOJ said it noted the public’s concern about the recent depreciation of the local currency. It sought to assure that based on Jamaica’s economic fundamentals, it did not expect that the recent pace of exchange rate movement will be sustained.

Additionally, the BOJ said it expects that these impulses will subside and that normalcy will return to the market.

The BOJ sought to explain the reasons for the depreciation, including an increase in demand for foreign currency due to the regular re-stocking by retailers for the Christmas season.

Added to that is the “extraordinary demand” relating to portfolio transactions.

Despite the slide in the value of the local currency, the BOJ is satisfied that inflows into the foreign exchange market remained healthy.

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