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PNP bemoans 'inept management' of foreign exchange market

Wednesday, April 17, 2019

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KINGSTON, Jamaica — The Parliamentary Opposition says that the foreign exchange market is once again suffering a period of severe shortage of supply of US Dollars coupled with a sharp devaluation of the Jamaican Dollar.

The Jamaican Dollar has fallen rapidly in April, from J$125.60/US$1 on April 1, 2019 to $133.79/US$1 yesterday April 16, or 6.5 per cent in 16 days, the People's National Party Shadow Minister of Finance & Planning Mark Golding said in a statement today.

According to Golding, businesses in the real sector are complaining that during this period the banking system has not been able to supply their normal needs for foreign exchange.

“This is the third such major disruption to the foreign exchange market in less than a year. It has happened even while the IMF has confirmed that Jamaica has accumulated more than adequate foreign exchange reserves to support a floating exchange rate system,' Golding stated.

“The inept response of the authorities has facilitated this 'double-whammy' of rapid currency depreciation and severe shortage of supply, over and over again. They are allowing the Jamaican Dollar to bounce around like a jack-in-the-box. It is damaging credit arrangements with suppliers, creating great uncertainty, and playing havoc on businesses,” he added.

He argued that the finance minister remained silent on the matter, “clinging to his position that this situation is just the normal workings of the market, and Jamaicans must get used to it.”

Golding called upon the Bank of Jamaica to use the tools at its disposal to bring an end to the disruption to businesses and the economy that it has caused by allowing these sudden and extreme spikes and shortages in the foreign exchange market.

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