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May 2022 Volume 22 Number 4 - Bank of Jamaica - jamaica stock market performance


May 2022 Volume 22 Number 4 - Bank of Jamaica-jamaica stock market performance

May 2022 Volume 22 Number 4
2022 Bank of Jamaica
Nethersole Place
Kingston
Jamaica
Telephone: (876) 922 0750-9
Fax: (876) 967 4265
Email: library@boj.org.jm
Website: www.boj.org.jm
ISSN 0799 1037
Printed in Jamaica
Monetary Policy at the Bank of Jamaica
Bank of Jamaica's monetary policy objective is to achieve an inflation target of 4 - 6 per cent per annum for the
next three years. This inflation rate, measured as the annual point-to-point change in the consumer price index
that is published by the Statistical Institute of Jamaica, will facilitate sustained growth and development in
Jamaica.
The inflation target was established by the Minister of Finance and the Public Service in consultation with Bank
of Jamaica in April 2021.
The Bank uses a variety of tools to achieve its inflation target, the main one being the interest rate on overnight
balances in the current accounts of deposit-taking institutions at Bank of Jamaica. Changes in the Bank's policy
rate signal the Bank's policy stance towards achieving its inflation objective, which is transmitted to prices through
the financial markets and then through spending and investment decisions.
Monetary policy decisions affect inflation with a lag of between 4 to 8 quarters. For this reason, monetary policy
in Jamaica is forward looking and the Bank puts much effort into establishing its view of the economy in the
future, and bases its decision on this view. It is also important that the Bank clearly and transparently
communicates this view of the future to the Jamaican public. The Bank undertakes an assessment of the
economy eight times during each calendar year and publishes its decisions in accordance with a pre-announced
schedule. On four of these occasions, when most data on the key macro-economic variables are available, the
Bank prepares a comprehensive macroeconomic forecast covering the international economy, the fiscal
accounts, balance of payments, money, credit, interest rates, GDP and prices.
This Monetary Policy Report describes the Monetary Policy Committee's most recent policy decision and outlines
the Bank's projections for inflation in Jamaica and the main macroeconomic variables that affect it. The Monetary
Policy Report is prepared and published once every three months at the time of four of the Bank's monetary
policy announcements.

How important is the financial sector to the JSE’s combined index? As at January 28, 2022, the JSE’sfinancial index accounted for 59.6% of the total stock market capitalization, which means the sector plays a significant role as it relates to the direction of the Combined Index.