Dealers sold US$4M in BOJ FX auction

The first BFXITT auction on Wednesday in which Bank of Jamaica offered to purchase purchased US$5 million, attracted 12 offers and fetched just US$3.95 million at an average rate of $125.42.
The highest bid was at $126 to sell US$500,000 with the lowest being $124.50 at which US$500,000 was traded. The rate compares with an average sale of $13.42 million in the overall market up to Midday at an average of J$1215.24.
The central bank started the BFXITT auction in July last year, only selling the US dollar to dealers before today. The bank has scheduled buying US$12 million on April 18 and US$15 million April 25, no trade is announced for the first week in May. The buying of the US dollars in the auction comes against the back ground of a revaluation of the local dollar to $125 after slipping to just over $128 to the US dollar in March. At a recent briefing relating to the commencement of buying through the BFXITT system as part of dissemination information, the Governor of the central bank, Brian Wynter indicated that the decision to buy or sell is based on market intelligence provided by the dealers through their customers.
The commencement of buying of foreign currency through BFXIIT auction also comes at a time that the central bank has reduced the percentage that it used to take from the daily inflows into the market and the planned phasing out of compulsory surrender requirement by authorised dealers.

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