Exchange Rate Fluctuations and Sectoral Index Behaviour of the Jamaica Stock Exchange Market (2012-2022)

Shaneille Samuels

Abstract: This study examines the relationship between USD/JMD exchange rate fluctuations and the performance of various sectoral indices on the Jamaica Stock Exchange (JSE) from 2012 to 2022. It uses correlation and regression techniques to assess how currency movements influence indices such as the Main Market Index, All Jamaican Composite Index, and JSE Select Index, with additional focus on the Financial and Manufacturing & Distribution Indices from 2021 to 2022. Findings suggest weak, statistically insignificant relationships for major indices, while newer indices like Financial and Manufacturing & Distribution exhibit stronger sensitivity to exchange rate changes, with a perfect positive correlation coefficient of 1. The study offers insights valuable to policymakers and investors navigating economic uncertainty and currency volatility, such as sectoral diversification to leverage against the downturns.

Keywords: exchange rates, sectoral indices, stock market, currency fluctuations, Jamaica

How to Cite?: Shaneille Samuels, "Exchange Rate Fluctuations and Sectoral Index Behaviour of the Jamaica Stock Exchange Market (2012-2022)", Volume 14 Issue 6, June 2025, International Journal of Science and Research (IJSR), Pages: 526-537, https://www.ijsr.net/getabstract.php?paperid=SR25605104625, DOI: https://dx.doi.org/10.21275/SR25605104625