Richard Byles gives final BOJ report to Standing Finance Committee

Bank of Jamaica Governor Richard Byles has made his last appearance before the House of Representatives' Standing Finance Committee ahead of retirement, using the occasion to outline major economic shocks faced during his nearly seven years at the central bank and to give an outlook for Jamaica's economy.

Byles told committee members his tenure had included the COVID-19 pandemic, supply-chain problems that pushed inflation worldwide, two major hurricanes, and wars in Ukraine and the Middle East. He said the central bank maintained its focus on price stability and the soundness of the financial system through those pressures.

Reviewing the second half of the 2025-26 fiscal year, Byles said inflation is expected to rise during the June and September 2026 quarters from 4.3 per cent in April 2026, and is projected to move above the BOJ's 4 to 6 per cent target band. He linked that forecast mainly to supply and cost pressures, including higher energy and transport inflation tied to increased crude oil prices.

The outgoing governor said real GDP growth is projected between 1 and 3 per cent in 2027-2028, following an estimated contraction of 1 to 2 per cent for the 2025-26 financial year.

Byles also pointed to Jamaica's reserve position, saying gross international reserves stood at about US$6.5 billion on May 26, 2026, equal to 130.5 per cent of the level assessed as adequate. However, he warned that global political and economic conditions are expected to weigh on the current account in the near term, largely because of higher fuel imports and increased imports linked to post-hurricane infrastructure rebuilding.

On inflation under his leadership, Byles said Jamaica averaged 6 per cent annual inflation between September 2019 and April 2026. Excluding the global supply-chain inflation period from April 2021 to March 2023, he said inflation averaged 5 per cent, within the target range.

He reported that, as at May 26, 2026, the exchange rate had strengthened by 1.5 per cent year over year to J$157.9 to US$1, compared with a 2.3 per cent depreciation in the previous 12 months.

In response to committee questions, Byles said the weakness of monetary transmission remains a structural concern. In Jamaica's concentrated banking sector, he said, policy signals do not fully pass through to lending and credit rates, leaving a difficult issue for the next governor.