So it looks like Jamaicans are running back to the US dollar.

It wasn’t that long ago when any little extra money you get, you drop it in a USD savings account.

That’s because the Jamaican dollar was so unstable, that people felt they had to save in USD to counter the effects of devaluation.

Around 2017 though, the Bank of Jamaica implemented the B-FXITT system, which helped to stabilize the local currency and ensure that it fluctuated both ways.  Some days the dollar was high; some days it was low.

This made saving in USD less attractive, because you could actually lose money on the conversion.

But fast forward to 2025, and here we go again.  

According to the Bank of Jamaica, Jamaicans moved roughly J$95 billion into US dollar accounts in 2025. 

That’s 13% more than the year before. It works out to nearly four out of every ten dollars in the banking system being saved in US dollar accounts.

The BOJ attributed this to several things, but the main reason was Hurricane Melissa. People and businesses apparently got nervous about the economic outlook. 

So instead of keeping their money in Jamaican dollars, they shifted into US dollars, which is viewed as more stable.

One consequence of this is that it puts pressure on the Jamaican dollar. The more demand there is for US dollars, the more strain that puts on the exchange rate. That’s part of the reason the central bank had to step in and sell over US$1 billion last year to stabilise the market.

On top of that, it can affect borrowing and investment. If businesses are holding US dollars instead of investing locally, that can slow down economic activity and growth.

But the BOJ isn’t sounding any alarms just yet. They think this trend is temporary, especially as rebuilding picks up after the hurricane and the economy improves.

But we also have to watch what’s happening with Iran and oil prices, because that may also put pressure on the supply of USD, and therefore affect the value of the JMD.

And that’s the bottom line.