THE Bank of Jamaica (BOJ) has announced a new cut in interest rates, swiping as much as 90 basis points off its largest open market tenor.

All seven tenors were adjusted, with the larger cuts at the higher end, narrowing the rate gap to one percentage point at the extreme ends of the spectrum, and pulling interest rates below 14 per cent.

The 30-day instrument, following a 35 basis point cut, is now priced at 12.6 per cent, while the 365-day tenor is at 13.6 per cent, down from 14.5 per cent.

The central bank last adjusted rates in March.

The new cut comes a day behind the finance ministry's announcement that it would not be as aggressive in the local market as planned, following the over-subscription of its latest eurobond, priced at a low for Jamaica of nine per cent.

Yesterday, the BOJ cited improvements in the economy, a stable foreign exchange market, strong reserves and the take up on the eurobond as reasons for the cut.

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