BOJ targets sliding dollar

The Bank of Jamaica (BOJ) said it would be implementing several temporary measures to cushion the impact of the sliding Jamaican currency.



Last week, the Jamaican dollar reportedly dropped an average 13 to 15 cents per day.



As of today, the BOJ will be offering a Special Certificate of Deposit to Primary Dealers and Commercial Banks, to mature on December 3, 2008.



It says interest payable on this instrument will be 20.5 percent per annum.



This offer expires tomorrow.



The central bank said on the December 3 expiration of the 15-day notice period, the cash reserve requirement of commercial banks, merchant banks and building societies will be increased from 9 to 11 percent.



This means that the liquid asset requirement would therefore rise to 25 percent from the current 23 percent.



These requirements will gradually be increased by a further 3 percentage points.



The BOJ said these monetary policy actions are also aimed at supporting the achievement of the inflation objective and the maintenance of macroeconomic stability.