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Wednesday, March 11, 2009
Net International Reserves (NIR) have dipped 9.2 per cent to US$1.6 billion in one month according to the latest figures released by the Bank of Jamaica (BOJ), the biggest dip in five months.
The NIR - seen as the country's last resort in defending the dollar - dipped by US$163. million in the month ending February mainly because foreign assets declined by US$138 million.
Over the month the dollar declined 2.5 per cent against its US counterpart to $88.29 at the end of February.
The government's NIR target is $1.75 billion for this fiscal year. The last time the NIR came close to February's drop was back in October when it dipped 19.9 per cent to US$1,802.6 million.
In October the sharp NIR decline according to the BOJ was based on debt payment on behalf of the government; usual sales to the market; and loans under the US$300 million dollar loan facility for financial institutions.
The currency usually devalues about seven per cent a year. But it devalued some 22 per cent since September. Over the period the BOJ had hiked up interest rates to 26 per cent, to stem the dollar slide.
But financial analysts have expressed alarm over hike. The BOJ, had said that the revisions reflect concern about the rising trend in inflation and its impact on the attractiveness of Jamaican dollar investments.
http://www.jamaicaobserver.com/magaz...____IN_FEB.asp
Net International Reserves (NIR) have dipped 9.2 per cent to US$1.6 billion in one month according to the latest figures released by the Bank of Jamaica (BOJ), the biggest dip in five months.
The NIR - seen as the country's last resort in defending the dollar - dipped by US$163. million in the month ending February mainly because foreign assets declined by US$138 million.
Over the month the dollar declined 2.5 per cent against its US counterpart to $88.29 at the end of February.
The government's NIR target is $1.75 billion for this fiscal year. The last time the NIR came close to February's drop was back in October when it dipped 19.9 per cent to US$1,802.6 million.
In October the sharp NIR decline according to the BOJ was based on debt payment on behalf of the government; usual sales to the market; and loans under the US$300 million dollar loan facility for financial institutions.
The currency usually devalues about seven per cent a year. But it devalued some 22 per cent since September. Over the period the BOJ had hiked up interest rates to 26 per cent, to stem the dollar slide.
But financial analysts have expressed alarm over hike. The BOJ, had said that the revisions reflect concern about the rising trend in inflation and its impact on the attractiveness of Jamaican dollar investments.
http://www.jamaicaobserver.com/magaz...____IN_FEB.asp