There has been some strengthening in the JMD money market, as measured by the aggregated current balances held by Deposit-Taking Institutions (DTIs). 

The total aggregate current balance was $69.07 billion last week, compared to the previous week $46.20 billion. Demand for Bank of Jamaica (BOJ) liquidity management instruments remained healthy last week, underscoring continued appetite for short-term Jamaican-dollar investments. 

The BOJ’s 30-day Certificate of Deposit (CD) auction attracted J$47.46 billion in bids against an offer of $35.0 billion, resulting in a 1.36x bid-to-cover ratio (1.24x in the previous auction). The stronger subscription reflected robust demand despite the BOJ increasing the amount offered by J$3.00 billion with total bids rising by 19.9% compared with the previous auction. 

The BOJ also conducted a 14-day repurchase agreement (repo) auction, which received J$2.30 billion in eligible bids against an offer of J$1.30 billion. Based on these figures, the implied bid-to-cover ratio is approximately 1.77x. 

The auction’s weighted average yield increased by 37 basis points to 5.98%, suggesting participants demanded slightly higher returns for short-term liquidity. Overall, the latest auction results suggest domestic liquidity remains ample, with investor demand for short-term BOJ instruments continuing to outpace supply despite the central bank increasing issuance.

FX market operation

In the Foreign Exchange Market, the Jamaican dollar (JMD) appreciated as it took J$0.81 less at the close of trading to purchase one United States dollar (US$1).. The appreciation was largely influenced by the Bank of Jamaica’s (BOJ’s) intervention in the market, selling US$50.00 million through its B-FXIT interventions on June 25th (US$30.00 million) and 26th (US$20.00 million), which increased the supply and, in turn, translated to a stronger JMD.