BOJ cuts policy interest rate to 5.5%

 

The Bank of Jamaica has reduced its policy interest rate by 25 basis points to 5.5 per cent, citing an improved inflation outlook.

 

The decision was made by the Bank's Monetary Policy Committee during meetings held on February 19 and 20.

 

The Committee said the direct impact of Hurricane Melissa on inflation was less severe than first expected. It noted that agricultural supplies recovered faster than anticipated, helping to ease price pressures. Recent appreciation of the Jamaican dollar also contributed to lower inflation.

 

The Bank says inflation is now projected to remain within its target range over the next eight quarters, with only a few temporary exceptions.

 

As a result, the Committee unanimously agreed to lower the policy rate — the rate offered to deposit-taking institutions on their current account balances at the central bank — effective February 24.