BOJ suggests FX stability close

Bank of Jamaica, in an unusual weekend press release, indicated that positive trends in the economy and increased flows of foreign exchange in March over the first two months of the year will provide an increasingly solid base for improved stability in the foreign exchange market.

“Since the beginning of March 2014, the exchange rate has depreciated by J$0.93 (0.85%) against the US dollar. This movement over the two-week period compares to a J$0.49 (0.45%) depreciation over the previous two weeks. The faster pace of depreciation has occurred despite increased supply in the foreign exchange market, where volumes from earners for the month to date, are higher than for January and February 2014.” the central bank stated in a release this evening.

Us$_Bankroll280X150“Jamaica’s main economic indicators continue to improve with economic growth resumed in the September quarter and is expected to strengthen over the subsequent six months in the range of 1.0 per cent to 2.0 per cent. Preliminary estimates of the balance of payments indicate that the current account deficit was reduced sharply over the period April 2013 to September 2013, by approximately US$350.0 million. The current level of net international reserves (NIR) is US$1,121.4 million, increasing by US$52.0 million since the end of February 2014. Bank of Jamaica now expects to comfortably meet the NIR target under the International Monetary Fund agreement for the March 2014 quarter. Finally, headline inflation was lower than projected at 0.5 per cent for the month of January and the fiscal year to March 2014 is now likely to fall close to or below the bottom of the 8.5 per cent to 10.5 per cent target range. The BOJ stated that against the background of recent movements in the exchange rate, they wish to assure the public that it stands ready to provide support to prevent disorderly conditions from emerging in the foreign exchange market.” the release concluded.

2013 Remittance inflows top $2B

Total remittance inflows into Jamaica for 2013 hit a record of US$2.07 billion, US$23 million more than the amount received in 2012, which was the previous record year at US$2.043 billion according to data from the Bank of Jamaica. Net remittances for January to December 2013 were US$1.82 billion, an increase of US$49 million compared to 2012.

The out-turn for December reflected an increase in gross remittance inflows and a contraction in outflows with net remittances for the month reaching US$176 million, an increase of US$2.2 million over the similar period of 2012. Gross remittance inflows for the month were US$195 million, a decrease of US$1.7 million relative to December 2012.

Image courtesy of Boaz Yiftach/

Image courtesy of Boaz Yiftach/

For the fourth quarter of 2013, net remittances were US$476 million, an increase of US$27 million or 6.0 per cent relative to the corresponding quarter of the previous year resulting from an increase in gross remittance inflows and a contraction in remittance outflows.

Total remittance inflows for the December quarter were US$533 million, representing an increase of US$16 million or 3.0 per cent relative to the corresponding quarter of the previous year.

Related posts | Remittance inflows continues up | October remittances up

Jamaica’s trade deficit improves

Jamaica’s trade deficit improvement experienced a recovery in the year to November 2013 as both imports, which fell by US$392 million and exports, down by US$112 million, resulted in the deficit falling by 6.2 percent or US$289 million when compared to the similar period in 2012.

Overall, imports for the 11 month period in 2013 was US$5,664 million, down from US$6,056 million for the same period in 2012 and exports of US$1,442 million, resulted in a trade deficit of US$4,221 million as reported by the Statistical Institute of Jamaica (STATIN).

Imports | Freezone activity accounted for US$295 million in imports, compared to US$352 million in the corresponding 2012 period. The category of Mineral Fuels, which accounts for 35 percent of the country’s import bill, fell by US$229 million to US$1,984 million compared to the same period of 2012. Machinery and Transport Equipment fell by US$20 million to US$831 million. Chemicals imports was valued at US$741 million, a decrease of US$80 million. Manufactured Goods fell by US$41 million or 7.1 percent to US$544 million. Spending on Food, however, rose by US$12 million to US$888 million as a result of the sharp rise in the price of basic commodities.

Traditional Exports | For the period of January to November 2013, the country earned US$724 million from traditional domestic exports which fell by 2.9 percent or US$22 million versus 2012 period largely due to the decline in Manufacturing exports. Non-traditional domestic exports fell by US$104 million or 13.9 percent to US$643 million compared with the first eleven months of 2012.

Trade with USA improves | The value of imports from the United States of America, a major trading partner, fell by US$145 million or 7 percent to US$1,940 million to November 2013 compared to the similar period in 2012. Merchandise exports sold to the USA fell by US$19 million to US$711 million resulting in the trade deficit of US$1,229 million, down from US$1,355 million for the similar 2012 period, a decline of US$126.5 million.

Trade with CARICOM worsens | Goods imported by Jamaica from the CARICOM region from January to November 2013 grew by US$4.5 million to US$822 million, due largely to increased expenditure on “Food” which increased by US$13 million to US$151 million. Total exports fell by 20 percent or US$15 million to US$63 million.

Related posts | USA trade deficit worsens, Caricom improves | Big drop in trade deficit