WITH EFFECT from yesterday, 26 January 2004, the Bank of Jamaica has reduced interest rates applicable to the entire spectrum of its open market instruments.
This latest reduction in interest rates is the 9th since rates peaked in March 2003 and comes after the Central Bank's indication of a favourable outlook for emerging market debt and also after the Government successfully launched and priced a 5-year Euro 200 million Eurobond in the international capital markets. The proceeds of this Eurobond issue and the buoyant foreign exchange flows will increase the capacity of the Bank of Jamaica to maintain stability in the foreign exchange market.
A release issued by the bank yesterday read:" The proceeds of the bond, together with the anticipated seasonal improvement in the fiscal accounts, will also enable the Government to reduce its reliance on the domestic market for financing its requirements. These conditions augur well for further reductions in interest rates".
Only last week, the BoJ reduced interest rates applicable to its open market instruments. It cited the recent price performance of Jamaica's externally issued bonds and the favourable outlook for emerging market debt for lowering interest rates then.
