TRADERS DESK - December 9, 2022
Traders Desk
Published: October 20, 2023By:
Foreign Exchange Market Update
- •The FX market continued to show moderate liquidity week over week with a slight depreciation of $J (0.05%) to satisfy the requests for end-users and institutional clients.
- •There was no B-FXITT intervention from the Bank of Jamaica (BOJ) for this week.
- •Week over week, USD demand was comparatively slow with the anticipation that this will continue for the remainder of the year.
- •We also expect the market to remain quiet for the remainder of the year with the disruptions expected based on long weekends around the holiday season.
- •For the week beginning December 12, 2022, we expect the JMD to lose momentum as businesses focus on setting payroll and bonus payments.
Weighted Avg BOJ Rate
Currency | J$/USD |
02-Dec | $154.51 |
09-Dec | $154.59 |
WoW Var (%) | 0.05% |
Currency | J$/GBP |
02-Dec | $187.81 |
09-Dec | $187.42 |
WoW Var (%) | -0.21% |
Currency | J$/CAD |
02-Dec | $115.65 |
09-Dec | $113.84 |
WoW Var (%) | -1.57% |
Bond Market Update
- •For this week we continued to see a rally in prices of risk assets including the emerging market bonds following the release of the job market results in the prior week. Results printed stronger than expected.
- •Shorter dated bond prices remained relatively flat for the week with the exception of longer dated bonds.
- •Bond prices saw increases of 1.50% and 3.15% for JAMAN 45 and JAMAN 39 respectively, while the 25’s and 36 on average remained stable week over week.
- •With the anticipation of a softer policy rate hike this week from the U.S Fed, we expect prices to continue on their upward trend barring any deviation from expectations.
- •Following the CPI information that was released early this week, with consumer price index coming out just 0.1% higher than the previous month, we expect to see a boost in the market as the economy begins to loosen up.
JAMAN 2025 | |
02-Dec | $106.25 |
12-Dec | $106.00 |
YTM | 5.11% |
Change Wow | -0.24% |
JAMAN 2025 | |
02-Dec | $111.25 |
12-Dec | $111.50 |
YTM | 4.87% |
Change Wow | 0.22% |
JAMAN 2028 | |
02-Dec | $109.25 |
12-Dec | $110.00 |
YTM | 4.63% |
Change Wow | 0.69% |
JAMAN 2036 | |
02-Dec | $114.50 |
12-Dec | 114.75 |
YTM | 6.79% |
Change Wow | 0.22% |
JAMAN 2039 | |
02-Dec | $119.00 |
12-Dec | 122.75 |
YTM | 5.82% |
Change Wow | 3.15% |
JAMAN 2045 | |
02-Dec | $117.00 |
12-Dec | 118.75 |
YTM | 6.31% |
Change Wow | 1.50% |
Money Market Update
- •Interest rates on the short term overnight rates (< 30 days) remain on a downward trend with a range of 7.5% - 8.25% on the lower end, a slight downtick compared to the previous week.
- •The JMD market showed a slight increase in liquidity for the period. The market saw a reduction in demand for JMD for shorter term funds while the longer term funds remained stable.
- •The rates on longer tenures decreased slightly ranging from 8.75% - 8.90%.
- •The BOJ 7.50% Fixed Rate 30-day Certificate of Deposit auction for the allocation of J$19.5B was oversubscribed, with total value received amounting to J$25.4B. The average yield for successful bids was 9.08%, with highest submitted bid rate of 12.00% and lowest of 7.75%.
- •Week over week, USD rates remained relatively flat with sufficient liquidity with rates ranging between 3.75% - 4.25% for shorter tenures with longer tenures seeing rates between 3.85% - 4.40%.
- •For the week starting December 12, 2022, the expectation is that both the JMD & USD liquidity will remain moderate while the market awaits information surrounding the FED decision this week.
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