BOJ FX auction rate drops $1 to $132.75

The average rate for the sale of the US$10 auction sale by Bank of Jamaica in its regular B-FXITT Standard Intervention on Wednesday, fell by $1 to $132.74 this week from $133.75, in the previous week’s auction.
The central bank offered US$10 million to eligible bidders that attracted 31 bids amounting to $21.5 million, 17 bids were accepted and resulted in an average rate of $132.74. the out turn suggest that rates in the spot market for foreign exchange could decline in the next series of trading.
Interestingly, the highest bid was priced at $133.90 and the lowest at $130.83. The lowest bid that was successful was at $132.30 and received just 16.3 percent of the amount applied for.
The final scheduled auction for October will be on the 17th when US$10 million will be auctioned.
In trading on the foreign exchange market on Tuesday, dealers bought $46.28 million in US dollar currency at an average of $132.39, slightly below the rate in today’s auction. Dealers sold US$46.94 million at an average rate of $133.34 overall, trading of all currency amounted to just over $55.3 million for both selling and buying. In trading on Monday, US dollars purchase amounted to just US$20 million at an average rate of $131.11 and sale of US$34 million at $133.99.
On Monday overall, trading of all currencies, amounted to just over $25 million and US$36.74 million, buying and selling respectively.

BOJ buys $5m at J$133.65

The rate Bank of Jamaica paid on Wednesday, July 25 to purchase US$5 million in the B-FXITT Standard Intervention Tool – buy operation average J$133.65.
Eligible dealers placed bids to buy only $5.5 million with the highest priced offer at 137.24 to sell $200,000 and the lowest at $126 for $200,000. BOJ purchased funds as high as $137.10 amounting 40 percent of the amount offered while the amount of $350,000 that was offered at $137 was fully taken up. Eligible Offers were received from 19 sellers while 18 had funds bought.
The central bank will buy US$5 on Wednesday July 31 and August 8 and will sell $10 million to the market on August 19.

BOJ buying pushed US$ rate

The official selling rate for the US dollar ended at J$130.47 on Wednesday, rising from $130.06 on Tuesday as sale to Bank of Jamaica under its foreign exchange auction, absorbed US$10 million at an average weighted rate of $131.17.
In Wednesday’s foreign currency trading, dealers bought just over US$27 million at an average rate of J$128.79 and sold over $35.4 million. Overall US$29.4 million of all currencies were bought by dealers and they sold US$38.2 million.
Dealers attempted to sell US$11.35 million to BOJ at rates as high as $134, for US$200,000 and as low as $126.80 for US$1 million. BOJ accepted all bids up to $132.93 and partially up to $133.
BOJ has been buying funds from the market from April when they started the buy side of the BFXITT auction.
On July 11, the central bank will sell US$5 million to the market and buy US$5 million on July 25. In April US$32 million was bought from the market, by BOJ, US$35 million was purchased in May and in June US$19 million. At the auction of Wednesday June 13, the central bank offered to purchase US$10 million buy only US$9 million was offered, the average rate ended at J$132.66 with the highest rate clearing at $133.50. On the June 13, the selling rate in the daily foreign exchange market jumped J$1.29 to JS$131.58 for US$1, a direct result of the BOJ buying, the rate moved even higher on the 14th even as inflows were more than sales on that day.
The central banks purchases helped to steer the Net International Reserves US$69 million higher in May to US$3.175 billion and also grew in April as well from US$3.075 billion at the end of March. At the end of February the NIR was US$3.18 billion.
July and August are two of the months with strong inflows of foreign exchange, but with summer being the prime time of Jamaicans to travel overseas demand tends to be high as well.

More recovery for Jamaican$ – Friday

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The Jamaica dollar gained further ground at the close of foreign currency trading on Friday against the US and the Canadian dollars and the euro as volumes increased over the previous week.
Dealers bought US$201 million in all currencies, up from US$191 million bought in the previous week and sold US$217 million, compared to US$210 million in the prior week. Actual US dollar purchases by dealers amounted to US$178 million from US$166 million in the prior week and sold US$190 million including US$15 sold to Bank of Jamaica in the BFXITT auction, compared to US$184 million previously.
Inflows of all currencies amounted to the equivalent US$35.26 million compared to US$34.79 million bought on Thursday and sold US$37.86 million compared to US$31.28 million sold on Thursday.
At the close of foreign currency trading, dealers sold US$29.69 million, 4 cents less than on Thursday with the US dollar selling rate closing at J$125.53, compared to J$125.57 in the sale of US$27.16 million on Thursday. Purchases of the US currency by dealers, amounted to US$29.47 million, with the average rate dropping 55 cents to $123.75, compared to US$32.90 million, with the average rate of $124.30 on Thursday.
At mid-day on Friday dealers purchased US$8.2 million at an average rate of J$124.37 and sold $7.46 million at an average of J$125.44. At mid-day on the previous trading day, dealers purchased US$12.17 million at an average rate of J$124.70 and sold $7.66 million at an average of J$125.49.
The Jamaican dollar closed trading, with the selling rate for the Canadian dollar, declining to J$100.96 from J$101.70 at the close on Thursday. The selling rate for the British Pound rose to J$174.7 from J$173.57 previously and the euro fell versus the Jamaican dollar to J$152.09 to buy the European common currency, versus the prior selling rate of J$152.63.

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.

BOJ buy auction of FX on Wednesday

Bank of Jamaica will be opening its foreign exchange auction – BFXITT on Wednesday to the buying US dollars for the first time .
The central bank that started the auction in July last year has only sold the US dollar to dealers buy will commence buying of US$5 million this week, in their once a week auction. The bank will be buying US$12 million April 18 and US$15 million on April 25. The bank that announces a forward 4 week schedule for the auction, has no trading scheduled for the start of May.
The buying of the US dollars in the auction comes against the back ground of revaluation of the local dollar to $125 on Tuesday, after slipping in value 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 takes from the daily inflows into the market and the planned phasing out of compulsory surrender requirement by authorised dealers.

No B-Fxitt sale by BOJ in December

There are unlikely to be any sale of foreign exchange by Bank of Jamaica during December, a release from the central bank suggests.
According to Jamaica’s central bank “market intelligence provided by authorised dealers and cambios on prevailing and prospective market conditions indicates that there is no need for the Bank to add foreign exchange to the market during the first two weeks of December 2017. The B‐FXITT process remains in place and Bank of Jamaica will continue to assess market intelligence going forward and engage with the foreign exchange market as appropriate.
The amounts the central bank made available in November was reduced to US$4 million per auction down from a usual amount of $10 million in the past. Based on historical tends with increase inflows into the system from Mid-December is very unlikely that the central bank will be doing much selling and could in turn start the auction to buy surpluses from the market which is expected to occur from December until April next year.
The change comes against the back ground of Bank of Jamaica reducing their compulsory take from 25 percent to 20 percent which will result in between US$40 and $50 million more available for the public on a monthly basis as well as a clear sign of sell off of foreign exchange by dealers from October.