KINGSTON, Jamaica — The Bank of Jamaica (BOJ) has reduced its benchmark policy interest rate by a quarter of a percentage point to 6.00 per cent a year, marking the central bank’s fourth consecutive cut in 2024.
The Monetary Policy Committee voted unanimously for the move, which takes effect on December 23, according to the BOJ’s policy announcement issued on December 20.
Inflation settles in the target range
The committee said inflation has become anchored within its four to six per cent target range. Annual headline inflation was 4.3 per cent in November 2024, down sharply from 7.4 per cent in January. Core inflation, which excludes agricultural food and fuel, came in at 4.2 per cent, the 17th straight month below six per cent.
The BOJ pointed to stable conditions in the foreign exchange market, easing wage pressures in October, relatively steady inflation expectations among businesses and the absence of increases in selected administered prices. Agricultural food prices also rose less than expected despite bad weather during the year.
Looking ahead, the MPC expects inflation to remain inside the target band over the next eight quarters, though it flagged upside risks from possible policy shifts among Jamaica’s major trading partners, the timing and scale of which remain uncertain. The next policy decision is scheduled for February 20, 2025.
A nudge to commercial lenders
In a pointed observation, the committee noted that interest rates on bank loans and other credit terms remain high and restrictive, suggesting there is scope for commercial banks to pass on more of the easing to borrowers.
What it means for homebuyers
The central bank has now cut its policy rate by a full percentage point since August, and its public comment on lending rates adds pressure on banks to lower mortgage pricing in 2025. Prospective buyers should compare offers across lenders and ask directly about rate reductions, while existing borrowers on variable-rate loans may want to check whether their repayments will fall. Those considering refinancing should weigh any fees against the savings, as further cuts are not guaranteed.
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