Durrant Pate/Contributor

Demand for money market instruments was strong in Jamaica last week, as evidenced by the oversubscription in the weekly Bank of Jamaica’s (BOJ) 30-day Certificate of Deposit (CD) auctions notwithstanding lower average yields. 

Total bids last week amounted to J$21.91 billion relative to the J$15.00 billion issue size, while the average yield declined to 5.79 per cent from 5.98 per cent the previous week. The J$15 billion allocated bid size marks a 64.3 per cent decline week-over-week and likely contributed to the lower yields. 

The BOJ also conducted a 14-day repurchase operation from deposit-taking institutions for the provision of Jamaican dollar liquidity in the amount of J$1.5 billion. The auction was oversubscribed with J$3 billion in total bids and an average yield of 6.135 per cent, up from the previous auction, which had an average yield of 6.115 per cent and an offer amount of J$1 billion.

Additionally, the Government of Jamaica (GOJ) in its most recent 91-day, 182-day and 360-day Treasury bills (T-Bills) auction was oversubscribed. The average yields for the respective tenors were 5.19 per cent, 5.37 per cent and 5.80 per cent. 

These yields came in lower than the government’s June auction, where there were only 91-day and 182-day T-bill offerings. The next auction of the GOJ Treasury Bills is scheduled for Tuesday, August 5, 2025.

Increase in JMD liquidity

In the meantime, liquidity in the Jamaican dollar money market increased, as measured by the aggregated current balances held by deposit-taking institutions (DTIs). As at July 11, the total aggregate current balance amounted to J$29.03 billion, marking a 34.5 per cent increase compared to the previous week. 

Meanwhile, in the foreign exchange market, the Jamaican dollar depreciated last week by 0.26 per cent, with the US dollar selling rate increasing from J$160.77 on July 4 to J$161.20 on July 11. The depreciation reflects increased inter-dealer activity, which placed an upward pressure on the greenback selling rate.