Jamaican dollar

Jamaican dollar

1 dollar coin
ISO 4217 code JMD
Central bank Bank of Jamaica
 Website www.boj.org.jm
User(s)  Jamaica
Inflation 10.2%
 Source Bank of Jamaica Economic Data, 2009
Subunit
 1/100 cent
Symbol $
Coins
 Freq. used 25c, $1, $5, $10, $20
 Rarely used 1c, 10c, 50c
Banknotes
 Freq. used $50, $100, $500, $1000
 Rarely used $1, $2, $5, $10, $20, $5000

The dollar has been the currency of Jamaica since 1969. It is often abbreviated "J$", the J serving to distinguish it from other dollar-denominated currencies. It is divided into 100 cents.

Exchange rate

Current JMD exchange rates
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History

The history of currency in Jamaica should not be considered in isolation of the wider picture in the British West Indies as a whole. See British West Indies dollar. The peculiar feature about Jamaica was the fact that it was the only British West Indies territory to use special issues of the sterling coinage, apart from the four-pence groat coin which was specially issued for all the British West Indies, and later only for British Guiana.

The earliest money in Jamaica was Spanish copper coins called maravedíes. This relates to the fact that for nearly four hundred years Spanish dollars, known as pieces of eight were in widespread use on the world's trading routes, including the Caribbean Sea region. However, following the revolutionary wars in Latin America, the source of these silver trade coins dried up. The last Spanish dollar was minted at the Potosí mint in 1825. The United Kingdom had adopted a very successful gold standard in 1821, so 1825 was an opportune time to introduce the British sterling coinage into all the British colonies.

An imperial order-in-council was passed in that year for the purposes of facilitating this aim by making sterling coinage legal tender in the colonies at the specified rating of $1 = 4s 4d (one Spanish dollar to four shillings and four pence sterling). As the sterling silver coins were attached to a gold standard, this exchange rate did not realistically represent the value of the silver in the Spanish dollars as compared to the value of the gold in the British gold sovereign, and as such, the order-in-council had the reverse effect in many colonies. It had the effect of actually driving sterling coinage out, rather than encouraging its circulation.

Remedial legislation had to be introduced in 1838 so as to change over to the more realistic rating of $1 = 4s 2d. However, in Jamaica, British Honduras, Bermuda, and later in the Bahamas also, the official rating was set aside in favour of what was known as the 'Maccaroni' tradition in which a British shilling, referred to as a 'Maccaroni', was treated as one quarter of a dollar. The common link between these four territories was the Bank of Nova Scotia which brought in the 'Maccaroni' tradition, resulting in the successful introduction of both sterling coinage and sterling accounts.

In 1834, silver coins of threepence and three halfpence (1½ pence) were introduced, valued at ½ real and ¼ real. The three-halfpence coins came to be called "quartiles" or "quatties." These in particular were used in church collections due to a feeling by the black population that copper coins were inappropriate for that purpose. Hence, they came to be called "Christian quatties".

In 1839, an act was passed by Parliament declaring that as of December 31, 1840, only British coinage would be legal tender in Jamaica, demonetizing all of the Spanish coins, with the exception of the gold doubloon which was valued at £3 4s. Coins in use were thus the farthing (¼d), halfpenny, penny, three halfpence (1½d), threepence, sixpence, shilling, florin (2s), half crown (2s 6d), and crown (5s).

The emancipation of the slaves in 1838 increased the need for coinage in Jamaica, particularly low-denomination coins, but the blacks were still reluctant to use copper. The solution was to use cupronickel, adopted in 1869. Pennies and halfpennies were minted for use in Jamaica, becoming the first truly Jamaican coins. Beginning in 1880, the farthing was also minted in cupronickel.

In 1904, the first government-authorized banknotes were produced in the denomination of 10s. Banknotes of £1 and £5 were also being circulated by chartered banks. In 1918, denominations of 2s 6d and 5s were authorized. The 2s 6d note proved to have a short life, being withdrawn in 1922. In 1940, the government bank began producing £1 and £5 notes.

In October 1960, the Bank of Jamaica was given the sole right to mint coins and produce banknotes in Jamaica. Their notes were released on May 1, 1961, in the denominations of 5s, 10s, £1, and £5.

On January 30, 1968, the Jamaican House of Representatives voted to decimalize the currency by introducing the dollar, worth 10 shillings, to replace the Jamaican pound. Coins and banknotes went into circulation on September 8, 1969. The introduction of a decimal currency provided the opportunity for the introduction of a complete Jamaican coinage as formerly, the coins (with the exception of the penny and halfpenny), were the same as those used in the United Kingdom. The reverse of the decimal coinage was designed by Christopher Ironside, O.B.E.. These coins were in circulation from 1969 to about 1990.

From its introduction, the Jamaican dollar has fallen from a peak of J$0.77 to US$1 in its first few years of circulation to a series of new lows exceeding J$119 to US$1 in September 2015. It was a huge setback to their economy.[1]

The new Jamaican dollar (and the Cayman Islands dollar) differed from all the other dollars in the British West Indies in that it was essentially a half-pound sterling. All the other dollars either began on the US dollar unit or the Spanish dollar unit.

Coins

Jamaica's currency is the Jamaican dollar. The value of the Jamaican dollar fluctuates but in October 2012 it was approximately J$90 to US$1. At the time of its introduction, coins of 1 cent (1.2 pence), 5 cents (6 pence), 10 cents (1 shilling), 20 cents (2 shillings) and 25 cents (2 shillings 6 pence) were produced. With the exception of a smaller bronze 1 cent, the compositions, sizes, and shapes of the coins were identical to those they replaced.

The 1-cent coin was changed in 1975 to a twelve-sided shape and aluminium composition. Decagonal 50-cent coins were introduced in 1976 to replace the 50 cent banknote, but production for circulation ceased in 1989, along with that of the 20 cents. In 1990, nickel-brass 1 dollar coins were introduced to replace the banknote of the same denomination. Nickel-plated steel replaced copper-nickel in the 5, 10, and 25 cent coins in 1991 with a smaller size and seven-sided shape for the 25 cent coin. In 1994, a round nickel-plated steel 5 dollar coin replaced its corresponding banknote, a smaller, seven-sided nickel-plated steel 1 dollar coin was introduced, and the 5 cent coin was abandoned. 1995 saw smaller, round copper-plated steel 10 and 25 cent coins. All non-current coins were demonetized in January 1997. A scalloped nickel-plated steel 10 dollar coin replaced the 10 dollar note in 1999 and a bimetallic 20 dollar coin with a nickel-brass ring and copper-nickel center was introduced in favor of a 20 dollar banknote in 2000.[2] All nickel-plated or copper-plated steel coins are magnetic.

All coins have the Jamaican coat of arms on their obverse.

Coins currently in circulation are as follows:[3]

Banknotes

On 8 September 1969, banknotes of 50 cents (5 shillings), $1 (10 shillings), $2 (£1), and $10 (£5) were introduced. The $5 note was introduced on 20 October 1970, followed by the $20 in June 1976, when the 50 cent note was replaced by a coin. $100 notes were added on 2 December 1986, followed by $50 notes on 27 July 1988. The $2 note was dropped in 1994, whilst the $1 note was replaced by a coin in 1990. In 1994, coins replaced the $5 notes and $500 notes were introduced. In 1999, $10 coins replaced notes, whilst, in 2000, $20 coins replaced the notes and $1000 notes were introduced.

Banknotes currently in circulation are:[4]

The Bank of Jamaica introduced a $5000 bill into Jamaica's monetary system on 24 September 2009.[5] It bears the portrait of former Prime Minister of Jamaica, The Honourable Hugh Lawson Shearer. On May 18, 2009, a specimen note was presented to the former Prime Minister's widow, Dr. Denise Eldemire-Shearer. Some have criticized the Bank of Jamaica's measure to introduce this banknote. Among the critics are Finance Minister Audley Shaw, who says that the introduction of such a banknote is a sign that the Jamaican Dollar is losing value.

On November 15, 2010, the Bank of Jamaica issued a $50 commemorative note to celebrate its founding. The note is similar to its regular issue in design and security features, but the bank's logo printed in blue, with the words "50th anniversary and 1960-2010" printed above and below the logo. The back of the commemorative note features the Bank of Jamaica headquarters building in Nethersole Place set against a background of morning glory blossoms. Both the commemorative and the regular issue note circulate in parallel.[6]

In 2012, the Bank of Jamaica introduced a new family of banknotes commemorating the country's Golden Jubilee. The commemorative banknotes are similar to its regular issue banknotes, but on the obverse it features the "Jamaica 50" logo superimposed on the watermark on the front of each note. The unique image, which is normally on the reverse side of each note, has been replaced by a photograph of a group of children from Central Branch Primary School, from 1962. It formerly appeared on the $2 note, which was in circulation from 1969 to 1994.

Currently, the Jamaican banknotes are printed on a cotton material which has a relatively short life in the country's tropical climate and other circulation conditions, but the new notes will come on enhanced substrates.

The $100 note is printed on a material called "Hybrid", a combination of a protected polyester film layered on a cotton fiber core. The $50, $500, and $1000 notes are printed on a varnished cotton substrate, that is, the traditional cotton treated with a varnish after the notes have been printed. Varnishing creates a moisture -proof layer to protect the banknotes against surface soiling and reduces the extent to which they will absorb moisture, contaminant particles and microorganisms. The $5000 note remains on a regular cotton substrate as the main security thread, "Optiks", is compatible only with the cotton based material.

The commemorative notes are released into circulation on July 23, 2012 and the new notes will circulate alongside the regular issue banknotes.[7]

On March 24, 2014, the Bank of Jamaica issued a $50 note printed on the "Hybrid" substrate.[8]In 2015, the Bank of Jamaica issued a $100 note dated January 1, 2014 on the "Hybrid" substrate.[9]

Use outside of Jamaica

The Jamaican dollar was used not only by Jamaica, but also by the Cayman Islands, a former dependency of Jamaica, until 1972. In that year, the territory stopped using the Jamaican dollar and adopted its own currency, the Cayman Islands dollar.

Half Pounds

In adopting the Jamaican dollar, Jamaica followed the pattern of South Africa, Australia, and New Zealand in that when it adopted the decimal system, it decided to use the half pound unit as opposed to the pound unit of account. The choice of the name dollar was motivated by the fact that the reduced value of the new unit corresponded more closely to the value of the US dollar than it did to the pound sterling.

See also

References

  1. ↑ http://www.boj.org.jm/uploads/excel/Historic_rates.xls
  2. ↑ Bank of Jamaica | Currency Structure Policy
  3. ↑ Bank of Jamaica | Coins
  4. ↑ Bank of Jamaica: Banknotes
  5. ↑ Linzmayer, Owen (2012). "Jamaica". The Banknote Book. San Francisco, CA: www.BanknoteNews.com.
  6. ↑ Jamaica 50-dollar commemorative confirmed BanknoteNews.com. Retrieved 2012-06-29.
  7. ↑ Jamaica new commemorative notes confirmed BanknoteNews.com. Retrieved 2012-06-29.
  8. ↑ Press release on the issuance of the $50 "Hybrid" note Bank of Jamaica (www.boj.org.jm). Retrieved on 2014-03-19.
  9. ↑ Jamaica new 100-dollar Hybrid note confirmed BanknoteNews.com. June 4, 2015. Retrieved on 2015-06-13.

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