The Bank of Jamaica has again held its benchmark interest rate at 5.75% per annum, marking the third consecutive decision to leave rates unchanged.
The central bank says the economic impact of Hurricane Melissa has been more severe than initially expected and could result in greater inflationary pressure in the months ahead.
According to the Bank of Jamaica, damage to roads, buildings, the electricity grid and other infrastructure is estimated at about 40% of gross domestic product.
Damage to the agricultural sector alone is estimated at roughly 50% of its 2024 GDP.
The bank has warned that headline inflation is expected to rise above its target range of 4 to 6% over the coming months, driven mainly by higher food prices and increased electricity rates.
It also notes that core inflation, which excludes volatile food and energy prices, is likely to trend higher as reconstruction efforts get underway, particularly as much of the rebuilding will be financed through external sources.
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