BOJ governor justifies decision to hold policy rate at 5.5%

 

New Bank of Jamaica Governor Dr. Brian Langrin on Thursday explained the decision of the Monetary Policy Committee (MPC) to hold the policy rate at 5.5 per cent. 

 

He said the decision was unanimous. 

 

"The committee also agreed to remain proactive in preserving relative stability in the foreign exchange market. This decision reflects the MPC's assessment that the recent rise in inflation is being driven primarily by temporary, external and administrative factors while domestic conditions remain broadly stable. Holding the policy rate steady at this time is therefore consistent with the bank's mandate, but it does not mean the bank is standing still," he declared.

 

Headline inflation increased to 7.5 per cent in July up from 6.7 per cent in June. 

 

Dr. Langrin said the MPC expects inflation to remain above the 4-6 per cent target range during the September quarter before falling in the target range in the near term.