Bank of Jamaica projects full recovery from Hurricane Melissa within 2 to 3 years

The Bank of Jamaica (BOJ) now anticipates that the country’s economy will fully recover from the impact of Hurricane Melissa within two to three years, faster than the previously projected three to four years.

BOJ Governor Richard Byles said the improved outlook reflects a quicker rebound in agriculture and a stronger-than-expected recovery in electricity and telecommunications services. He made the remarks during the Bank’s Quarterly Monetary Policy Report press conference at the BOJ auditorium in downtown Kingston on Tuesday, February 24.

For the fiscal year 2025/26, the BOJ expects a contraction in real gross domestic product (GDP) of between 1 and 3 per cent, a smaller decline than previously estimated. As the economy recovers, GDP growth for 2026/27 is projected at 1 to 3 per cent.

Mr. Byles noted that Jamaica’s current account balance is expected to worsen in the medium term due to Hurricane Melissa’s impact on tourism and increased imports for infrastructure rebuilding and relief efforts. However, he said the effect will be mitigated by higher remittance inflows and insurance receipts. The current account balance for 2025/26 is projected between a deficit of 0.5 per cent of GDP and a surplus of 0.5 per cent, compared with a surplus of 3 per cent in 2024/25.

Despite these pressures, Jamaica’s international reserves remain strong, reaching a record US$6.8 billion as of February 19, 2026—approximately 155.8 per cent of the benchmark considered adequate.

The Governor also highlighted the resilience of the domestic financial system following the hurricane. Deposit-taking institutions (DTIs) maintained capital adequacy and posted broad resilience ratios above potential market, credit, and liquidity risk scenarios. While the ratio of non-performing loans increased slightly from 2.5 per cent at the end of 2024 to 2.8 per cent at the end of 2025, it remains well within the prudential benchmark of 10 per cent.

Private-sector credit growth remained stable, recording 8 per cent growth in 2025 compared with 7.3 per cent the previous year.