BOJ’s Steady Work Amid Global Turmoil

• Bank of Jamaica (BOJ) Governor Richard Byles reported to the Standing Finance Committee (SFC) of Parliament on June 10 that the central bank has achieved significant policy successes. This was achieved through the steady and professional execution of its statutory mandate of price and financial system stability over the past seven years. He noted that this record of stewardship by the Bank was established amid a climate of considerable externally originating turbulence, including a global pandemic, supply chain disruptions that drove inflation across the world, two major hurricanes, and wars in Ukraine and the Middle East.
• In his final report to the SFC during his tenure as Governor, Mr Byles told members of the House of Representatives that the Bank’s policy achievements included inflation that was significantly controlled within target over the period, financial system soundness, and the start of a slate of institutional reforms. He noted that the BOJ has been an operationally independent central bank since 2021, a government policy decision that Mr Byles described as bold and consequential.
• On financial system stability, the Governor pointed to the fact that despite profound global disruptions, there were no bank failures in Jamaica, which places Jamaica in a strong macroprudential position. By comparison, the United States’ Federal Deposit Insurance Corporation reports 19 bank failures over the seven-year span to date.
• In relation to the foreign exchange market, the Jamaican dollar depreciated at a moderate average of 2.9% per year, which is broadly in line with the inflation differential with the United States, thus preserving the country’s external competitiveness. Gross international reserves also increased significantly from US$3.6Bn in 2019 to US$6.4Bn as of May 2026, the Governor reported.
• The BOJ played a leading role in policy reforms that helped secure Jamaica’s removal from the Financial Action Task Force’s Grey List in 2024, strengthening the country’s financial reputation. Governor Byles also highlighted that the Bank has contributed significantly to public finances, paying more than J$50Bn in dividends to the Ministry of Finance over the past seven years.
• Governor Byles further emphasised the BOJ’s modernisation agenda, including the introduction of more secure polymer banknotes and continued expansion of the JAM-DEX digital currency platform, with phone-to-phone transactions expected soon. Jamaica remains among a small group of countries to pioneer a central bank digital currency.
• In terms of fundamental challenges, Mr Byles pointed to the weakness of monetary transmission in Jamaica’s concentrated banking system and conceded that this remains a structural challenge constraining the pass-through of policy signals to credit and lending rates. This, he suggested, will not resolve itself quickly and remains a challenge for the future leadership of the central bank.

(Sources: Bank of Jamaica)