Money market liquidity for US$ remained moderate

The Jamaican dollar appreciated by 1.46 per cent last week, closing the period at $149.75.

This appreciation was due to increased US dollar liquidity in the foreign exchange market, as brokers continue to supply the market with hard currency. Additionally, the month of March is regarded as peak season for companies to pay their income taxes and, as such, they are exchanging American dollars for local currency to pay taxes.

MARKET LIQUIDITY REMAINED GENERALLY MODERATE

These companies are also seeking to take advantage of the higher exchange rates. The money market liquidity for the American dollar money market remained generally moderate.

National Commercial Bank Capital Markets reports that “broker market demand is at 60-day and longer tenured funds. Jamaican dollar liquidity was adequate week over week. Brokers opted to place for tenures 30 days and longer”.

It should be noted that the Bank of Jamaica did not offer a FR 30-day instrument for the week of March 1-5 and, as such, there was no auction.