During the last six days of December 2018, the Bank of Jamaica (BOJ) recorded net currency issue of $5.45 billion to financial institutions, substantially above its projection.
The currency issue for the week contributed to an overall growth of $23.6 billion or 21.4 per cent in the currency stock for December 2018, above the bank’s projection for growth of $18.1 billion or 16.5 per cent.
The increase for the month also exceeded that for December 2017 and was the largest growth in a December month since 2007, the BOJ said.
“The faster currency growth possibly reflected improved GDP growth, employment and retroactive wage settlements during the period,” the central bank added.
At December 31, 2018, the currency stock amounted to $133.5 billion, representing an annual increase of 20.4 per cent relative to annual growth of 12.9 per cent at end-December 2017.
When the estimated change in consumer prices is taken into account, the real annual growth in currency at end-December 2018 was 15.9 per cent compared to 7.3 per cent for the corresponding period in 2017.
The bank is anticipating that most of the currency issued during December 2018 will be redeemed during January 2019. For the last five years, net currency redemption in January averaged 75.8 per cent of the net currency issued in the preceding month.
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