Monday, 22nd July 2013 | Jamaica’s central bank signaled to the forex market today “not so fast” in the movement of the Jamaican dollar against its main intervention currency, the US dollar. Our source indicates that the central bank did selective selling to some financial institutions, as such, not all dealers got the central bank’s funds. We were unable to get the amount that BOJ sold to the system but data of past trading Mondays suggest that the figure could be around US$15-20 million.
Since the start of July the amounts bought on Mondays give some indication of the likely amount sold into the system. The July purchases are as follows: Monday July 1 a little more than US$38 million; Monday July 8 nearly US$39 million and Monday July 15 the amount was less at US$30.5 million. In today’s trading, purchases amounted to US$60.4 while selling took place for $57.6 million as the US dollar moved up 19 cents for the buying rate to close at $101.44 and the selling rate slipped back by 19 cents to close at $101.81.
The central bank’s intervention may have arisen from last week’s trading in which US dollars purchased exceeded the amount sold by nearly US$10 million, while the rate kept on slipping. This would have sent a signal that traders may be building up a long position in the currency, even as the actual sale of US dollars was US$4.5 million more than the amount purchased in the week ending July 12th, which was less than the net position last week. These figures are for the US dollar currency alone and ignores surpluses of Pounds and Canadian Dollars that were purchased and may have been converted to US dollars, the currency in greatest demand.
There was buying of C$1.065 million at an average rate of $95.95 at 24 cents less than on Friday but the average selling rate rose to $98.38, up by 33 cents as C$727,200 was sold. The Pound lost value but moderately, on both ends, to close at $152.76 buying and $155.68 selling as dealers bought £2 million and sold just £460,000.
Highest & lowest rates | Except for the highest buying rate for the US dollar which just barely inched up, there were no other changes in the rates for US currency. The Canadian dollar saw dealers spending $2.10 more when buying at the highest levels and 25 cents more at the lowest buying rate. For the sell side, the highest rate put on 32 cents and the lowest 25 cents. The Pound was bought at $2.80 more for the highest buying rate and 66 cents more on the lowest rate for selling. $3.47 was added to the highest rate and just 25 cents on the lowest rate.
