Guyana’s open-market system prone to fluctuations based on demand, supply – Guyana Chronicle
–BoG clarifies, says GCCI has mistaken impression of Central Bank’s role regarding currency availability
THE Bank of Guyana (BoG) has clarified that the law stipulates that the Guyana Dollar is a freely floating currency, traded in a market in which prices are determined by prevailing market conditions, that is to say demand and supply.
Responding to a press release from the Georgetown Chamber of Commerce and Industry on the matter of availability of foreign currency, the Central Bank said: “The GCCI appears to be of the mistaken impression that the BoG exists to ensure that foreign currency is available to their membership at the times that they demand and at prices that they demand.”
The BoG went on to state: “This is simply not how an open market economy operates, and is simply not how foreign currency availability and pricing are determined where floating currencies are concerned.”
In clarifying its mandate, the Central Bank said it is an independent institution with a clear mandate defined by law and in keeping with international norms and standards for central banking. Its objectives include fostering domestic price stability through the promotion of stable credit and exchange conditions.
“The GCCI’s energies would be better spent engaging either the banks or the bankers association, who are also members of the private sector, with a view to better understanding the factors that influence the availability and pricing of foreign currency in the domestic market,” the Central Bank said, adding: “The BoG remains committed to discharging its mandate and to engaging with the private sector on matters of concern to them in a mutually respectful manner.”
