Bank of Jamaica’s August 24 14-day CD auction cleared at a weighted average rate of 5.96 per cent. Here is how that number stacks up against two benchmarks, according to BOJ and Statistical Institute of Jamaica (STATIN) data:

• 46 basis points above BOJ’s 5.50 per cent policy rate
• 154 basis points below headline inflation of 7.5 per cent
• 76 basis points above core inflation of 5.2 per cent

Headline inflation: the CD rate is losing ground

STATIN’s All Jamaica Consumer Price Index rose 1.2 per cent in July 2026 alone. Over the twelve months to July, prices are up 7.5 per cent, up from 6.7 per cent in the twelve months to June.

BOJ’s August policy statement puts that 7.5 per cent figure above the top of its 4 to 6 per cent target range. Three categories drove the increase: transport, up 13.6 per cent year over year, food and non-alcoholic beverages, up 9.4 per cent, and housing, water, electricity, gas and other fuels, up 5.2 per cent.

Set against 7.5 per cent inflation, a 5.96 per cent CD rate loses roughly 1.5 percentage points a year in real terms. A saver rolling 14-day CDs is falling behind the cost of living STATIN tracks.

Core inflation: the CD rate is slightly ahead

Core inflation strips out volatile items like food and energy. BOJ put it at 5.2 per cent for July, well below the headline number.

Against that measure, the 5.96 per cent CD rate gains about 0.76 percentage points a year, a thin but positive real return.

BOJ leans on core inflation partly because headline figures can be pushed around by one-off shocks, such as the oil price pressure the bank has linked to Middle East tensions and the Russia-Ukraine conflict. Depending on which number an investor uses, short-term JMD paper looks either behind inflation or slightly ahead of it.

Why the CD rate sits above the policy rate at all

BOJ held its policy rate at 5.50 per cent again in August, saying it wants to keep a lid on second-round price pressures while inflation runs above target. CD auction rates have cleared above that policy rate at each of the last three 14-day auctions: 5.96 per cent on August 24 and 5.85 per cent on both August 3 and August 10.

That small premium lines up with strong demand at those auctions, where bids have run roughly double the amount BOJ allotted each time. Banks competing for a limited allotment is one reason the rate edges up.

Two fair readings exist side by side. Measured against the 7.5 per cent headline rate, current CD yields are losing to inflation. Measured against the 5.2 per cent core rate, they are running slightly ahead.

Which one matters more depends on what a saver is trying to protect: day-to-day living costs, which include food and transport, or the underlying price trend BOJ is targeting.