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Richard Byles
The Bank of Jamaica says the reduction in fares charged by the Jamaica Urban Transit Company is less likely to have any major effect on inflation in the local economy.
BOJ Governor Richard Byles says while there was some positive impact earlier this year, inflation is projected to be tempered less than a percentage point by the move going forward.
"Upon review, the bank now recognises that it had overestimated the impact of the reduction in JUTC fares. The two-phase reduction is now estimated to have an offsetting impact of only 0.2 per cent on annual inflation, with the first reduction already evident in the CPI data for January 2024," he noted.
Following the anouncement by Finance Minister Dr. Nigel Clarke of the temporary two-step reduction in JUTC fares, the BOJ had projected that inflation would generally remain within the 4 to 6 per cent target range except for December 2023 and a few months in 2024.
But the BOJ now says it expects inflation will remain outside the target range until June 2025.