BOJ’s recent US$15-m injection to stem local dollar slide
The Bank of Jamaica (BOJ) on Wednesday sold US$15 million of the US$50 million it said it would inject into the market over a four-week period.
Analysts say the move is aimed at market stability as the Jamaican dollar continues its fairly rapid devaluation against the US dollar, a scenario which started in April and which has seen the local currency lose roughly seven per cent of its value since that time.
The latest move by the central bank regarding its Foreign Exchange Intervention and Trading Tool, B-FXITT, was communicated to authorised dealers and cambios in a market release dated August 21.
The BOJ has advised that it will sell another US$15 million to the market on August 29 and US$10 million on September 5 and September 12 respectively.
The BOJ has faced mounting criticism in recent months for letting the dollar slide.
However, a source close to the bank, noted that in recent months, the BOJ has reduced the surrender requirement from the foreign exchange market . This speaks to the percentage amount it usually buys from authorised dealers each day.
“We have reduced the percentage amount that we purchase from those dealers twice in recent months which effectively means we have put back an average of US$60 million in the market every week,” the BOJ insider told Loop News.