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The Parliamentary Opposition has said the Bank of Jamaica needs to improve its market intelligence to maintain stability in the foreign exchange market.
In his contribution to the 2019/2020 Budget Debate on Tuesday, Opposition Spokesman on Finance Mark Golding said the Central Bank was slow to respond to the devaluation of the local currency when the U.S. dollar reached $137.96 last year, resulting in businesses recording foreign exchange losses.
Mr. Golding is urging the Bank of Jamaica to respond more effectively to sudden pressures caused by temporary imbalances in supply and demand in the foreign exchange market.
"The IMF's article four review as at March 2018 indicated that all is well when it comes to the fundamentals of Jamaica's foreign exchange position, so why are we having these repeated wild swings when we're supposed to be enjoying relative stability in the currency?" Mr. Golding questioned, urging the minister to explain to "the many businesses which lost money in the rapid and dramatic rise and fall of the dollar amidst panic and uncertainty."
The U.S. currency is now selling for an average $125.87, which is the lowest in almost a year.
The Opposition Spokesman on Finance has also taken issue with how the inflation target is set.
Mr. Golding argued that more consultations are needed.
"The process of setting and thereafter adjusting the inflation target must be transparent and inclusive. Mr. Speaker, it should be brought to this House in a Ministry Paper and debated so that the justificatidon for the proposed target can be publicly scrutinised and defended. I would like to see such a process included to the bill before it is brought to the House to be passed," he suggested.
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