BOJ says impact of Hurricane Melissa on inflation now projected to be less severe than previously anticipated; cuts policy rate to 5.50%

Bank of Jamaica says the impact of Hurricane Melissa on inflation, while significant, is now projected to be less severe than previously anticipated.

Governor Richard Byles made the declaration during a Monetary Policy press briefing in Kingston this morning.

He was explaining the Central Bank’s decision to reduce its policy rate by 25 basis points to 5.50%, effective today.

It is the first reduction since May 2025.

Governor Byles attributed the stabilisation to improvements in agricultural supplies and an appreciation of the exchange rate.

He added that the decision to reduce the policy rate reflects a cautious adjustment to the monetary policy stance and followed a detailed assessment of the most recent inflation outturn and the near-term outlook for prices.

Meanwhile, Byles said the Bank’s Monetary Policy Committee has assessed that there are positive and negative risks to the inflation forecast.

This means that, depending on scenarios, inflation could be above or below the projected levels.