JIS News

The Jamaican dollar experienced its sharpest quarterly appreciation since the June quarter of 1996, strengthening by 4.1 per cent for the just ended quarter.
“The strongest appreciation occurred in June when the exchange rate strengthened by 2.9 per cent or $2.46, influenced largely by increased investor preference for Jamaican dollar assets. The preference for Jamaican dollar assets was reflected in increased net private capital inflows, the impact of which more than offset the demand for resources to meet current transactions,” Bank of Jamaica (BoJ) Governor, Brian Wynter told today’s (August 12) quarterly press briefing at the Bank, in downtown Kingston.
He explained that in order to “smooth the pace of movement in the exchange rate,” the bank had purchased some US$54 million net from the market during the quarter. This contributed to a Net International Reserves (NIR) stock of US$1.79 billion as at the end of June, which was not only higher than the end of March stock, but also above the end of June target.
“At end-June 2010, the Bank’s gross revenues amounted to US$2,52 billion, representing 19.7 weeks of projected imports of goods and services, surpassing the benchmark of 12 weeks of imports,” he said.
Meanwhile, he informed that market-driven interest rates declined over the period alongside the appreciation of the local currency. The average yield on the benchmark 180-day Treasury Bill fell by 123 basis points to 9.26 per cent, while the yield on the 90-day instrument declined by 166 basis points to 8.52 per cent.
“Concurrent with the lower yields, there was continued narrowing in the spreads between government of Jamaica global bonds and emerging market bonds and US Treasuries, respectively,” he explained. Private money market rates also reflected this declining trend, Mr. Wynter noted.

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