Durrant Pate/ Contributor

As Jamaica’s money market continues to be liquid, there has been a reduction in the Bank of Jamaica (BOJ) money market auction rates.

The average yield for the most recent BOJ’s competitive price auction last week saw a further reduction to 10.41per cent over the 10.60 per cent recorded in the prior week.

The auction was oversubscribed with bids received totalling $63.6 billion relative to the offer size of $47 billion offered.

Consequently, the bid-to-cover ratio declined week-over-week from 1.59 to 1.36. The highest bid for full allocation was 10.77 per cent.

On the US dollar (USD) side, broker market demand for greenback remains high for longer-tenured funds.

Additionally, the Government of Jamaica announced an auction to offer a total of $2.2 billion in Treasury bills to the market that took place yesterday May 8.

Three tenors were auctioned with the 273-day tenor having an offer size of $800 million and J$700 million for the 91-day and 182-day tenors, respectively. In the foreign exchange market last week, the Jamaican dollar depreciated by 0.43 per cent relative to the USD week-over-week.

The week ended with US$1 dollar selling at a weighted average price J$157.21. This depreciation was due to a lower supply of USD in the foreign exchange market.

Imbalances between buyers and sellers are still prevalent in the foreign exchange market as sellers raise the asking price for USD.