BOJ Says Economy Starting to Show Signs of Improvement

Bank of Jamaica (BOJ) Governor, Richard Byles, says the country is beginning to show signs of incremental improvement in economic activity.

He cited the relatively buoyant foreign exchange market inflows, adequate reserves, a sustainable balance of payments position, and the containment of inflation within the Bank’s 4-6 per cent target range, as evidence of the progress being made.

He said that based on the latest development, “we believe the contraction in the economy is past its worst, and the outlook is for continued, albeit more gradual improvements in economic activity”.

Mr. Byles was addressing the BOJ’s quarterly digital briefing on Friday (February 19).

He noted that the 10.7 per cent contraction in domestic growth recorded in the September 2020 quarter represented an improvement on the the18.4 per cent decline for April to June 2020, and the Bank continues to project that for the full 2020/21 fiscal year, real gross domestic product (GDP) will contract in the range of 10-12 per cent.

The BOJ Governor said, however, that a partial rebound of at least four per cent in economic activity is projected to commence in fiscal year 2021/22 “and could possibly be as high as eight per cent if there’s strong recovery in tourism”.

“This projected growth in the fiscal year 2021/22 represents a first step in getting the economy back to levels of economic activity [predating COVID-19],” Mr. Byles added