IMF Mission Chief to Jamaica, Dr. Uma Ramakrishnan, says she has no problem with the recent appreciation of the Jamaican dollar.
The local currency has strengthened gaining $4.13 on the US dollar in the past six weeks. It traded at its weakest rate of $131.31. It’s now at its strongest in over 15-months.
CEO of the Private Sector Organization of Jamaica, PSOJ, Dennis Chung, warned last week that the local dollar is appreciating too quickly.
He says the country needs stability, rather than rapid fluctuations.
But Dr. Ramakrishnan says the positive change is normal.
She says the IMF isn’t concerned about the appreciation, which is now up to 3-percent in the past six weeks.
And this lack of concern goes against the traditional belief that the IMF favours a policy of continued depreciation for Jamaica.
Dr. Ramakrishnan says while this may have been the case a few years ago at the start of the Extended Fund Facility, it’s not so anymore, although this could change when they do their next assessment in a few weeks.
And, she also disagrees with Chung, that stability is the main goal. But she does say the Bank of Jamaica should only intervene in extreme circumstances.
The IMF Mission Chief was speaking with members of the media via video conference from Washington DC today.
This follows the release of the Fund’s second review under the Standby Arrangement last week.