GOJ Policy Rate

They don't have much room left to lower the signal interest rate, so they have chosen not to defend the dollar instead. The inflation makes JMD loans cheaper to encourage credit activity, and the devaluation makes exports and JMD assets cheaper to boost exports and FDI. As long as inflation is down, do they really care that much about the dollar?
The banks are making record profits, GOJ is betting that they won't try and raise JMD loan rates. So this way GOJ can keep their powder dry with the USD reserves and they still have 2% to play with on the signal rate. They saw what happened when the US fed rate went to zero and they basically have to throw up their hands after that.
-RG

In response to:
BoJ governor encourages consumers to 'shop around' for low interest rate loans

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