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BOJ responds to Jamaican dollar devaluation with US$ sale

Published:Saturday | October 22, 2016 | 10:33 AM

The Bank of Jamaica (BOJ) says it sold US$30 million to the foreign exchange market yesterday in response to decline in the value of the Jamaican dollar.

The BOJ described the decline as unwarranted and disruptive.

It says its intervention is intended to reassure users of foreign exchange that the BOJ is standing behind the preservation of orderly conditions in the market.

The US dollar gained four cents on the local currency with the Jamaican dollar being sold for $129.19 at the ended trading yesterday.

Meanwhile, the central bank says it will be paying out specified foreign currency denominated certificates of deposit ahead of their original maturity dates.

It says the early redemption will add significantly to the volume of US dollar liquidity available to institutions and individuals.

The BOJ says the total value of the securities amounts to US$258 million. 

It says notice of early redemption to instrument holders will be made next week.

The BOJ says it will continue to monitor liquidity conditions in our financial markets and take prompt remedial action as necessary to preserve orderly conditions.