BOJ Governor Richard Byles - file photo
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Richard Byles, speaking with 'Hotline' host Emily Shields
Bank of Jamaica (BOJ) Governor Richard Byles has said there is no shortage of US dollars in the local foreign exchange market.
Mr. Byles has reiterated that there is extra demand in the market.
He has also commented on the fluctuation in the exchange rate.
Speaking Friday on RJR's talk show programme, Hotline, Mr. Byles said the country's net international reserves cannot be used to intervene in the market every time the Jamaican dollar depreciates against the US currency.
"I don't think that BOJ has the responsibility to fund an investor who wants to put $20 million in some project or the other. We don't have the obligation to fund that out of reserves. The private sector mechanism that is managing foreign currency trading, they need to figure out how to digest and fund that $20 million and not knock on the country's reserve to do so," he asserted.
Mr. Byles said financial institutions should figure out how to fix the problem when it arises.
"There is possiblility for the end users to smooth out the volatility in the market by entering forward contracts and those contracts are facilitated by the commerical banks. Why isn't that happening," he questioned.
Mr. Byles added that banks should be more responsible in how they allocate US dollars when requested.
He said this is one way to prevent ad hoc large transactions which place pressure on the market.
"They have customers that are regular buyers from them. They need to allocate a reasonable amount of money to them and wait their turn to fill the extra demand," he contended.
Richard Pandohie, President of the Jamaica Manufacturers and Exporters Association (JMEA) told RJR News that the shortage of US dollars in the local foreign exchange market is worsening and is now a major cause for concern.
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