IMF concerned about financial sector management, BOJ strategy
BY AVIA COLLINDER Business reporter collindera@jamaicaobserver.com
(From left) Minister of state Rudyard Spencer, minister of state Fayval Williams, Finance Minister Audley Shaw, IMF mission chief for Jamaica Uma Ramakrishnan, IMF resident representative in Jamaica Bert van Selm and BOJ Governor Brian Wynter during a press conference at the Ministry of Finance last month.PHOTO: JIS
The International Monetary Fund (IMF) has expressed disappointment with the legal and operational infrastructure for financial stability in Jamaica, calling on the authorities to pull their act together in implementing plans to more tightly supervise the financial sector.
It is also suggesting that the Bank of Jamaica (BOJ) improve on its management of the exchange rate and thereby improve its “credibility”.
In the 2016 Article IV Consultation on Jamaica , directors of the IMF said reforms to the monetary framework should centre on achieving price stability, adding “a firmly established single mandate for achieving price stability will bolster the Bank of Jamaica’s credibility and lay the foundation for an eventual move to inflation targeting. In addition, the central bank’s liquidity provision should be made consistent with the loosened interest rate stance”.
The IMF said that it was its assessment that the Jamaican dollar, currently trading at just over $125 to the US dollar, is slightly overvalued, hinting at a need for correction.
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