5 months ago
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The government, opposition and business community are united in the belief that interest rates are too high.
All three have called on the players in the commercial banking sector to bring their interest rates in line with recent cuts made by the Bank of Jamaica, BOJ.
At its quarterly press briefing on Monday, the BOJ called for an objective assessment of the situation.
High interest rates make borrowing unattractive and incentivise individuals, households and businesses to save rather than spend or invest. This translates into a slowdown of economic activity.
Governor Richard Byles, a distinguished banker before his move to the BOJ, says many financial institutions shielded their customers in recent times from the high interest rates environment.
He says banks are treading carefully where rate reductions are concerned.
Richard Byles, governor of the Bank of Jamaica.
The BOJ boss agrees that banks must make some concessions to accommodate customers. However, he cautions against calling for the BOJ to take a direct hand in the matter.
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