Governor of the Bank of Jamaica (BOJ), Brian Wynter, addresses
the quarterly monetary policy report press conference, held at the
Bank’s downtown Kingston offices on November 19. At right is
Deputy Governor, BOJ, Livingstone Morrison.
The Governor of the Bank of Jamaica (BOJ) says the prospects for the Jamaican economy are positive, and the outlook is good for continued recovery in economic activity.
He also said the inflation rate is also back on target.
Mr. Wynter was speaking at the quarterly monetary policy report press conference, held at the Bank’s downtown Kingston offices on Monday, November 19.
“The expected growth predominantly reflects an improvement in net external demand, buoyed by increased production in mining and quarrying and expansion in construction and tourism-related activities,” Mr. Wynter said.
Mr. Wynter said consumption spending is estimated to have grown for the current quarter, supported by continued strong expansion in consumer credit.
However, he noted that the Bank assesses that gross domestic product (GDP), while improving, will continue to trend somewhat below potential output.
The Governor also noted recently released statistics on employment, showing unemployment is at a record low.
“The unemployment rate declined to 8.4 per cent at July 2018 from 11.3 per cent a year earlier. The fall in the unemployment rate reflected annual growth of 12,800 new jobs and a decline in the size of the labour force,” Mr. Wynter said.
“The Bank of Jamaica is expecting that there will be further improvements in the labour market conditions and employment over the next two years. This could, of course, provide a boost to wages, which could lay the basis for higher inflation in the future,” he added.
Mr. Wynter said the Bank continues to see an encouraging pickup in credit extended by deposit-taking institutions to the private sector.
In this regard, he said the Bank’s decision to hold policy rate unchanged at this time should continue to encourage increased economic activity and job creation, financed by strong growth in credit to the private sector.
Stating that inflation was back on target, Mr. Wynter noted that inflation had fallen below the four per cent to six per cent target between March 2018 and August 2018.
“However, the 12-month inflation at October 2018, as reported by the Statistical Institute of Jamaica (STATIN), was 4.7 per cent, higher than the 2.8 per cent recorded at the end of the June quarter,” the BOJ Governor said.
Mr. Wynter explained that the uptick in inflation since June 2018 largely reflects higher, more normal prices for agricultural food crops and increased electricity costs.
By: Franklin McKnight