Finance minister approves continuous medium-term inflation target for BOJ
Minister of Finance and the Public Service Audley Shaw has approved a continuous medium-term inflation target of four to six per cent for the Bank of Jamaica (BOJ).
That has replaced the annual fiscal year inflation target.
The Central bank says the target will be subject to annual reviews by the Minister, at which time it may be adjusted if economic conditions warrant.
It explains that the target is continuous over the medium term instead of only for the fiscal year because this allows the bank to be evaluated on Jamaica’s inflation rate at any time, not just at the end of a fiscal or calendar year.
It says operating with a target automatically makes monetary policy more predictable, transparent and justifiable, in keeping with international best-practice for leading central banks in developing and developed economies.
The BOJ says the medium-term inflation target was selected on the basis of Jamaica’s current and prospective economic circumstances.