Wednesday 29 May, 2013 | The level of buying of foreign currency climbed as Wednesday trades topped the high level of Tuesday’s trading. Although the amount bought out-paced the amounts sold, the selling rate for the US dollar inched up for the third day in a row. Buying ($40 million) exceeded selling for the second day in a row and selling was in the mid $30 million range. The US dollar selling rate went up by 8 cents and the pound sterling gained 26 cents while the Canadian dollar fell by 97 cents.
At the same time the central bank launched two new variable rate instruments to manage liquidity effective Friday May 29.
A 184-day Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.15 percentage point above the 3-month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 6.77 per cent per annum. This offer is extended to all Primary Dealers and commercial banks from 29 May 2013 to 07 June 2013.
An 18-month Certificate of Deposit, for an unlimited amount. The instrument re-prices quarterly at 0.25 percentage point above the 3-month GOJ Treasury Bill rate existing at the start of each re-pricing period. The initial coupon for the first three months is 6.87 per cent per annum. This offer is extended to all Primary Dealers and commercial banks from 29 May 2013 to 07 June 2013.
The move suggests that the central bank is more than comfortable with the existing rate of the Jamaica dollar versus the main intervention currency the US dollar.