Ja economy continues to contract – BOJ
Debbie-Ann Wright, News Editor - Radio
The Bank of Jamaica (BOJ) is reporting that the economy continued to contract in the final quarter of the last financial year.
The BOJ says for the January to March quarter the economy contracted in the range of -1.2 per cent to -0.2 per cent, continuing a trend observed since the March 2012 quarter.
The Central Bank says both the tradable and non-tradable sectors contributed to the contraction, which was largely influenced by severe drought conditions and weak domestic demand.
The BOJ also notes that the weighted average selling rate for the US dollar depreciated by six per cent to $98.89 at the end of March as the foreign exchange market remained unsettled despite the National Debt Exchange.
However, it says in spite of this depreciation, inflation was 2.7 per cent for the March 2013 quarter, which was marginally higher than the 2.6 per cent for December 2012 quarter.
Despite the inking of a deal with the International Monetary Fund (IMF), the BOJ is predicting further inflation and little to no growth for the June quarter.
It says domestic demand conditions are expected to remain weak in the near term and real GDP is projected to grow within the range of negative 0.5 per cent to positive 0.5 per cent.
The Central bank is expecting that growth to be mainly driven by improvements in Mining and Quarrying and Construction.
It is projecting that things will improve as the year progresses and growth for the 2013/2014 financial year, will be 0.5 per cent to 1.5 per cent in real terms.
Headline inflation for the June 2013 quarter is forecast to be in the range of 2.0 per cent to 3.0 per cent and 8.5 per cent to 10.5 per cent for the financial year.
FOR MORE STORIES WATCH: