Business

Settle down

Shaw urges Jamaicans to stop panicking over the forex market

BY KARENA BENNETT
Business reporter
bennettk@jamaicaobserver.com

Wednesday, September 27, 2017

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Finance Minister Audley Shaw has called for Jamaicans to stop panicking and speculating that there is a shortage of foreign currency on the market, noting that any extraordinary rush for foreign exchange could further depreciate the Jamaican currency.

“I am calling on every Jamaican and every businessman and every bank — stop it! Stop it! Settle down and let's keep our exchange rate stable, because the people that suffer the most from destabilisation of the exchange rate are our hard-working people of Jamaica, our poor people,” Shaw said. “If we want to build a competitive economy and move from poverty to prosperity, we need to keep our exchange rate stable.”

He was speaking at the launch of the Development Bank of Jamaica (DBJ) “Promoting Financial Inclusion in Jamaica” project at the Jamaica Pegasus hotel in Kingston yesterday.

Shaw, in contending that there was only need for the foreign currency market to settle down, noted that the Government and the Bank of Jamaica (BOJ) are putting in place an orderly process to ensure that information flows seamlessly throughout the foreign exchange market.

The minister, in assuring the public that foreign exchange market has settled, despite recent movements, said in the past year, the exchange rate has devalued by more than 1.8 per cent, less than two per cent, compared to seven per cent and eight per cent in previous years.

“It's [been] a very sharp deceleration, and we need to settle down. Everyone in the foreign exchange market needs to settle down because right now we have record foreign exchange reserves,” asserted Shaw.

“The figures that I saw yesterday [of] US$3.8 billion in gross reserves, almost US$4 billion in gross reserves, it is the highest level of gross reserves that we have ever had,” he reasoned.

Consequently, he highlighted that there is no need for for foreign exchange, which drives down the local dollar.

“If we want to build a competitive economy and move from poverty to prosperity, we need to keep our exchange rate stable. So we have done our part; we have raised our foreign exchange at record low interest rates [and] we have record high reserves in the system. What we need to do now is settle down, get to work, do what we have to do to benefit from the various opportunities, including the one we have here today,” he said.

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