The Bank of Jamaica (BOJ) says the country has adequate gross and net international reserves to finance its obligations, cushion against exogenous shocks, and address near to medium-term eventualities.

Addressing the BOJ’s digital quarterly media briefing recently, Senior Deputy Governor, Dr. Wayne Robinson, reported that the gross reserves total US$4.3 billion, representing 129 percent of the level deemed sufficient in accordance with the International Monetary Fund’s (IMF) measure of reserve adequacy.

Gross reserves measure the total value of foreign exchange and monetary gold reserves, special drawing rights, IMF reserve positions, and other assets denominated in dollars.

Dr. Robinson further advised that the NIR was approximately US$3.7 billion as at August 17, 2022.

The NIR reflects the difference between gross reserves and the country’s IMF loan debts.

Dr. Robinson assured that while the total NIR is 6.7 percent below the level at the beginning of October 2021, when the Bank adopted a more stringent policy stance in relation to inflation “we have… more than sufficient reserves.”

He informed that the factors considered when determining the level of reserves deemed adequate are the quantity of foreign exchange needed as a cushion in the event of a fallout in export earnings due to adverse exogenous shocks, such as COVID-19; the amount that would be required to service the Government’s external obligations; and the sum needed in the event of a sudden surge in capital outflows.

Read more at JIS

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Readers Bureau, Contributor

Edited by Jesus Chan

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