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BOJ cuts daily FX sale surrender requirements

Published:Thursday | January 25, 2018 | 4:13 PM

The  Bank of Jamaica (BOJ) said it will reduce by five per cent, the amount that authorised dealers and cambios are required to sell to the central bank from their daily purchases of foreign exchange, effective February 7.

That reduction brings the total surrender requirement from authorized dealers and cambios to 20 per cent and 15 per cent of daily gross purchases respectively.

The continued reduction in surrender requirements, in conjunction with the BOJ Foreign Exchange Intervention & Trading Tool (B‐FXITT), is in keeping with the ongoing reform programme to make its interaction with the foreign exchange market more transparent and to improve the efficiency and transparency of the market in general.

The central bank expects the reduction in surrender requirements to improve liquidity conditions in the foreign exchange market and contribute to its deepening, the BOJ said in a release.

“Going forward, the central bank will conduct periodic reviews of market conditions and other factors to determine the scope for further reductions in the surrender requirements, concurrently with further enhancements to B‐FXITT,” it added.