Both Sides of The Coin: The Story of The Central Bank of Barbados 1972-2017

52 Barbados dollars to one US dollar, for psychological reasons, since the anecdotal evidence suggested that it was acceptable to the Barbadian public. There was broad agreement on a number of related aspects. Firstly, the Bank would recommend to the minister that the Barbados dollar be fixed in relation to the US dollar from January 1975. Secondly, it was suggested that the minister be given a choice of three possible rates - two Barbados dollars to one US dollar, the average rate during the previous thirty days and the prevailing rate. It was also decided that a monitoring mechanism should be established to analyse variations in the rate. In the recommendation which eventually went to the minister no options in respect of the exchange rate were included. The governor felt that since a rate of two-to-one would gain ready acceptance, it would be pointless to recommend alternatives. When Barrow replied that he could not fix the rate without consulting “Barbados’” Caricom partners, the Bank sought to impress on him the need for those consultations to take place as quickly as possible. 1970 1971 1972 1973 1974 1975 4.80 4.80 4.80 4.80 4.80 4.49 2.00 1.95 1.93 1.96 2.05 2.02 1.91 1.94 1.94 1.96 2.08 1.98 2.40 2.40 2.40 2.15 2.25 2.21 1.0 1.0 1.0 1.0 1.0 0.93 1.0 1.0 1.0 0.92 0.92 0.86 2.0 1.96 2.10 2.12 2.47 2.45 Year UK£ US$ CAN$ JA$ TT$ GY$ EC$ TABLE 4 AVERAGE EXCHANGE RATE OF THE BARBADOS DOLLAR AGAINST VARIOUS CURRENCIES Source: Central Bank of Barbados, Annual Reports , 1972-1975.