• The Central Bank of Trinidad and Tobago has launched a five-year strategic plan aimed at making the institution more agile, technology-driven and responsive to emerging risks as the financial and economic environment becomes more complex.
• Guided by the theme “Insight to Impact”, the plan focuses on identifying emerging risks and opportunities and translating them into outcomes that strengthen the bank, the financial system and the wider economy. Governor Larry Howai noted that monetary and financial stability will remain at the core of the bank’s mandate, but continued evolution is essential in a rapidly changing environment.
• The plan also introduces an evolved institutional vision for the central bank to become a premier, trusted and innovative institution committed to a resilient Trinidad and Tobago. It is built around three strategic themes, supported by eight strategic objectives and 23 projects aimed at strengthening economic management, safeguarding the financial system and enhancing the people, technology, data and processes that support the bank’s work.
• Successful implementation will depend not only on the initiatives outlined in the plan, but also on the bank’s ability to adapt as risks, technology and stakeholder expectations evolve. A stakeholder engagement session is expected in November to discuss the plan’s priorities, objectives and implementation.
• The new strategy signals a stronger emphasis on institutional agility, technology and data capabilities as the central bank seeks to strengthen its ability to identify and respond to emerging economic and financial-system risks, while maintaining monetary and financial stability as its core mandate.

(Source: Trinidad Express Newspapers)

• The amount of oil in storage that is accessible to the global market is running low, industry executives said at the Energy ⁠Intelligence Forum in London, making the market more fragile and putting upward pressure on prices.
• Governments and energy companies have drawn oil from stockpiles to alleviate pressure in a global oil market facing unprecedented supply disruptions this year due to the wars in the Middle East and Ukraine. "Less than 6 billion barrels of commercial inventories remain today, with the vast majority not practically available, so the system is already straining," Amin Nasser, CEO of Saudi Arabia's state oil company Saudi Aramco, said. More than 1 billion barrels of oil have been released mainly from onshore commercial inventories since the start of this year's Middle East crisis, which was the last major tool in the box.
• The International Energy Agency (IEA), the West's oil watchdog and coordinator of its strategic oil reserves, is preparing to release 100 million barrels of crude and diesel to help alleviate soaring diesel prices, but it is not clear if some of that total will include volumes from its record first 400 million barrel release in March that hadn't hit the market yet.
• "It took a lot of negotiations, but it is 100 million," Nasser said of the IEA decision. "Inventories are reaching a stress level. Only 10% or less is available; that's why they struggle with 100 million barrels." World oil demand is about 102 million barrels per day, according to the IEA.
• The loss of the oil market's buffers has made the market more fragile and has increased oil's price floor. Oil market turmoil will continue beyond next year, as it could take years to refill inventories on top of meeting global demand. Not all oil in storage is immediately usable because of operational factors like tank bottoms or oil sitting in pipelines, ⁠as well as political factors like government rules dictating minimum levels of emergency stocks.
• Considering this, there is huge demand to build additional inventories around the globe. Kuwait Petroleum Corporation CEO Shaikh Nawaf Al-Sabah said his company is aiming to build out storage domestically and at its overseas refineries. Stocks of crude oil in the U.S. Strategic Petroleum Reserve are at their lowest ⁠since October 1982, according to data from the Department of Energy. Natural gas inventories are also depleted, making prices vulnerable to spikes. Furthermore, a bad winter could bring about a "bloodbath" in the gas market in the first quarter of 2027 if storage hits minimal levels.

(Source: Reuters)

• The United States (U.S.) trade deficit widened more than expected in August as imports jumped to a record high against the backdrop of robust domestic demand, keeping trade on track to again subtract from economic growth in the third quarter. The deterioration reported by the Commerce Department on Tuesday, October 6, 2026, was despite President Donald Trump's aggressive tariffs on imports, which he has argued are meant to shrink the trade gap.
• Economists have long argued that the US did not have the capacity to produce enough goods to meet its consumption needs. Some lowered their gross domestic product growth estimates for the July-September quarter. "The administration's trade policies have largely been a failure; trade tariffs have done nothing to reduce America's reliance on the import of foreign-produced goods," said Christopher Rupkey, chief economist at FWDBONDS. "The cost of American labour is simply too high to produce goods here cheap enough for consumers to even think about purchasing. Even if U.S. manufacturers were willing, the factories could not be built here fast enough to produce the goods that consumers depend on."
• The trade shortfall increased 13.7% to $105.6Bn, the largest since March 2025, and was at $79.8Bn when Trump was elected for a second term in November ⁠ Economists polled by Reuters had forecast the deficit would be $102.0Bn. August's deterioration was flagged by data last week that showed an import-driven surge in the goods trade deficit, and part of the increase reflected higher prices.
• Domestic demand increased at its fastest pace in more than 3-1/2 years in the second quarter, reflecting robust consumer spending and business spending on equipment, mostly related to AI. But businesses are relying on imports to meet demand. Imports increased 4.3% to an all-time high of $420.8Bn in August. Goods imports jumped 5.3% to $342.2Bn, partly due to businesses replenishing inventories, which have been drawn down for five straight quarters. They were boosted by a $9.1Bn increase in industrial supplies and materials, which include petroleum. Crude oil imports rose $3.3Bn while nonmonetary gold increased $3.1Bn.
• Capital goods imports soared $6.2Bn to a record high $146.4Bn, driven by semiconductors and other industrial machinery, reflecting the AI infrastructure buildout. Exports also rose 1.4% to $315.2Bn, while goods exports increased 2.2% to $205.7Bn, reflecting a $6.3Bn rise in industrial supplies and materials, mostly nonmonetary gold, crude oil and fuel oil.
• In addition to being a drag on GDP growth, the trade deficit also has inflation implications ⁠as it underscores excess demand. Economists said it supported their expectations that the Federal Reserve would raise interest rates again this year. "The Fed had better pay good attention to all this excess demand stuff," said Carl Weinberg, chief economist at High Frequency Economics. "Underlying the price shock from elevated energy prices, there is a demand-driven inflation challenge in the US economy. Energy prices are just an overlay onto that."

(Source: Reuters)

• Caribbean Information and Credit Rating Services Limited (CariCRIS) has reaffirmed Seprod Limited's (SEP’s) corporate credit ratings. Seprod holds a CariA rating on the regional scale, meaning its creditworthiness is strong compared with other Caribbean borrowers. On the Jamaica national scale, it maintained its jmAA- rating for local currency, meaning high creditworthiness compared with other Jamaican borrowers, and jmA+ for foreign currency, meaning good creditworthiness.
• CariCRIS also moved the outlook on these ratings from negative to stable. It implies there is a high chance that Seprod's financial flexibility will keep improving over the next 12 to 15 months. This rests on Seprod replacing short-term debt with a longer-term bond, holding more cash, building a stronger capital base and focusing on debt reduction. With these changes, Seprod's debt service coverage ratio (DSCR) is expected to stay above 1.00x, allowing it to keep generating enough cash to cover its debt payments. This resolves a key concern raised in the previous review. The company is also expected to remain profitable, meet its loan conditions, and pay its debts on time over the same period.
• Seprod's strong market position, built on a varied range of products and wide distribution across the Caribbean, supports the rating. The company performed well financially in 2025, staying profitable and improving its debt metrics. Its integrated business model, good management practices, strong corporate governance and capable leadership team also support the ratings.
• The rating or outlook could improve if the Government of Jamaica's credit rating is upgraded, if Seprod's net profit (PAT) margin rises above 5% for two years, or if its DSCR stays at 1 time or above for two years.
• However, the rating or outlook could be lowered if the Government of Jamaica's credit rating is downgraded within the next 12 to 15 months. Trade tensions or higher tariffs that raise supply and inventory costs enough to push the gross profit margin below 25% could also lead to a downgrade. If PAT margin stays below 3% for two years, or a DSCR below 1.00x for two years, this could also trigger a rating downgrade.
• Seprod's recent growth has been largely inorganic and debt-financed, notably through the acquisitions of A.S. Bryden and CPJ. That strategy has broadened the Group's regional footprint and product portfolio, but it has also put material pressure on its leverage profile and solvency metrics. Realising projected operational efficiencies and synergies from these acquisitions will be critical to supporting profitability and cash generation. Furthermore, its proposed additional public offer (APO), if approved by shareholders, would be a meaningful step toward rebalancing the capital structure. Fresh equity would strengthen the capital base, compress gearing and improve solvency ratios. It would also reinforce the deleveraging trajectory and improved financial flexibility that underpin CariCRIS's revision of the outlook to stable.
• On the equities front, SEP’s stock price has decreased by 6.3% since the start of the year to close at $78.64 on October 5, 2026. At this price, the stock is trading at a price-to-earnings (P/E) ratio of 13.1x, which is below the Main Market Manufacturing Sector’s average of 13.4x

(Source: CariCris & NCBCM Research)

• CariCRIS reaffirmed the Government of Trinidad and Tobago’s sovereign issuer credit ratings at CariAA for both Foreign and Local Currency on its regional rating scale. The ratings indicate that the country’s level of creditworthiness, relative to other rated obligors in the Caribbean, is high.
• CariCRIS maintained a stable outlook, reflecting expectations for broadly maintained macroeconomic stability over the next 12 to 18 months. This is expected to be supported by low but positive real GDP growth, continued financial sector soundness, robustness in Trinidad and Tobago’s sovereign wealth fund, and continued adequacy in international reserves and import cover.
• Key rating strengths include Trinidad and Tobago’s large regional economy, supported by energy and non-energy activities, satisfactory financial sector, monetary and exchange-rate conditions, and strong underlying balance-of-payments characteristics with adequate international reserves.
• These strengths are tempered by fiscal performance that remains closely linked to volatile energy supply and prices, alongside high government expenditure. Persistent social vulnerabilities, worsened by labour-market shocks and crime levels, as well as continued inadequacies in statistical compilations, were also highlighted.
• Positive rating triggers include a reduction in total general government debt to below 65% of GDP over the next 12 months, sustained improvement in the debt service coverage ratio (DSCR) to above 7.00x over two consecutive years, a fiscal surplus above 3% of GDP over two consecutive years, and an increase in import cover to 12 months or more over the next 24 months.
• An increase in total general government debt above 100% of GDP over the next 12 months, a sustained deterioration in debt-servicing capability to below three times, a fiscal deficit above 10% of GDP over two consecutive years, import cover falling to six months or less, or annual economic contraction exceeding 2% over the next two years could result in a rating downgrade.
• The stable outlook reflects CariCRIS’ expectation that Trinidad and Tobago’s external buffers, financial-sector soundness and sovereign wealth fund will continue to support macroeconomic stability, while fiscal performance remains vulnerable to energy-sector volatility and high expenditure.

(Source: CariCRIS)

• Saint Lucia’s geothermal exploration is moving forward, with work now taking place in several communities as the government seeks to determine whether the island can eventually generate electricity from heat beneath the ground.
• According to Physical Development and Public Utilities Minister Keithson Charles, the World Bank-funded project is “quite advanced”. The undertaking remains in the exploration stage, with Saint Lucia seeking to establish whether the underground resource is strong enough to support electricity generation.
• A project implementation team is already in place and consultations have been held with residents and farmers in the affected communities. The next stage will involve civil works, including road construction and expansion and preparation of the well pads where drilling rigs will eventually sit.
• The bidding process is nearing completion, with contractors expected to be brought on board so the project can move into the drilling phase and determine the geothermal resource available.
• The broader goal is to reduce Saint Lucia’s exposure to volatile global fuel prices. Successfully harnessing geothermal energy could help stabilise electricity costs, although this would not necessarily mean cheaper electricity. The government is also considering solar and wind energy as part of its wider push to reduce dependence on imported fuel.
• Progression to the drilling phase will be a key milestone, as it will determine whether Saint Lucia has a geothermal resource strong enough to support electricity generation and potentially provide greater stability in electricity costs.
• Saint Lucia’s geothermal push forms part of a broader effort across the Eastern Caribbean, where several countries, including Dominica, Grenada, Montserrat, St. Kitts and Nevis, and St. Vincent and the Grenadines, are pursuing geothermal projects or exploration at varying stages of development. These initiatives are aimed at reducing dependence on imported fuel and limiting exposure to volatile global energy prices.

(Source: St. Lucia Times)

• Canada's services sector contracted for a fourth consecutive month in September as trade tensions and the war in Iran weighed on demand, exports and business confidence, S&P Global's purchasing managers' index (PMI) showed on October 5, 2026. The deterioration eased from August, but activity remained firmly in contraction territory, underscoring the pressure facing businesses as higher trade barriers and geopolitical uncertainty raise costs and weaken demand.
• S&P Global's Canada Services Business Activity Index climbed to 48.3 in September from 46.8 in August, but remained below the 50 threshold¹ which separates growth from contraction. "September once again proved to be a difficult month for businesses," said Paul Smith, economics director at S&P Global Market Intelligence, noting that both output and new work declined during the month.
• Businesses continued to cite tariffs and the war in Iran as major sources of uncertainty, with the disruptions weighing on export trade while pushing operating costs higher, Smith said. Canada and the United States have imposed successive rounds of counter-tariffs since early 2025, while Washington last week expanded restrictions affecting imports of several Canadian products, including alcoholic beverages, motorcycles and dairy goods.
• Demand remained weak in September. The new business index rose from August but stayed below the 50 mark at 48.5, extending its contraction streak to five months. New export business declined at a faster pace than in August, highlighting the impact of weaker international demand and trade disruptions.
• At the same time, cost pressures intensified. The services-sector input price index increased to 62.2 from 61.7 in August, pointing to a further acceleration in operating expenses. The weak demand and elevated costs leave Canada's services economy facing a difficult backdrop, with businesses contending with the effects of trade restrictions while geopolitical tensions continue to cloud the outlook.

______________________

¹The 50 threshold on the PMI indicates whether business activity is expanding or contracting compared with the previous month. A reading above 50 indicates expansion, while a reading below 50 indicates contraction. A reading of 50 indicates no change in business activity.

(Source: Investing.com)

• United States (U.S.) services sector activity slowed in September, while strong domestic demand stretched supply chains and pushed a measure of prices paid by businesses for inputs to its highest level in more than four years, suggesting inflation could remain elevated into 2027.
• Complaints about higher fuel prices dominated responses to the Institute for Supply Management (ISM) survey published on October 5, 2026. The US-Israeli war with Iran has raised prices of energy and related products and led to shortages of commodities shipped through the Strait of Hormuz. Diesel prices are at record highs, hitting farmers and truckers. Economists have also warned that higher prices could soon spill over to other sectors and broaden inflation pressures.
• The ISM ⁠said its non-manufacturing Purchasing Managers' Index (PMI) fell to a still-high 54.9 last month from 55.4 in August. A reading above 50 indicates growth in the services sector, which accounts for more than two-thirds of US economic activity. Economists polled by Reuters had forecasted that the PMI would be largely unchanged at 55.2. The PMI is at a level consistent with strong economic growth in the third quarter. The economy is being driven by robust domestic demand, mostly consumer spending and business investment in AI and related infrastructure.
• Thirteen services industries reported growth last month, including wholesale trade, utilities, retail trade, information, transportation and warehousing, as well as finance and insurance, accommodation and food services. Among the four industries reporting a contraction were mining and construction.
• But supply chains are struggling to cope, a situation that has been worsened by the conflict in the Middle East. Steve Miller, the chair of the ISM Services Business Survey Committee, said "tariffs and fuel cost impacts were the most cited issues impacting respondents' supply chain," noting that "fuel costs were mentioned twice as often as any other single issue impacting performance."
• The survey's measure of supplier deliveries increased to 53.2 from 51.3 in August. A reading above 50 indicates slower deliveries. That measure has slowed for 22 consecutive months, boosting input prices. Supplier delivery performance was initially affected by tariffs on imports.
• The surveys pointed to higher inflation down the road. Last month, the Federal Reserve raised its benchmark overnight interest rate by 25 basis points to the 3.75%-4.00% range, its first hike in three years, and flagged further increases in borrowing costs ahead. Financial markets were pricing in a roughly 26% chance of a rate increase at the Fed's meeting this month, down from about 71% last week, CME Group's FedWatch tool showed.

(Source: Reuters)

• The Bank of Jamaica (BOJ) will raise its policy rate by a further 50 basis points (bps) to 6.50% at its November 2026 meeting, following the unanimous 50bps hike to 6.00% in September, according to BMI. The tighter policy stance is expected to continue through year-end as elevated inflation pressures risk further unanchoring of inflation expectations and increasing second-round effects. This marks a revision from the research company’s previous expectations that rates would hold through 2026.
• The September rate hike reflected a deterioration in the inflation outlook, with the BOJ seeking to limit the potential spillover of ongoing supply shocks into broader domestic price pressures. Headline inflation remained elevated at 7.9% in August, well above the BOJ’s 4.0%–6.0% target range, while core inflation held at 5.2%. As such, rising inflation expectations and persistent core inflation suggest that second-round effects are beginning to emerge.
• Inflation expectations have also increased, with one-year expectations rising to 7.3% in July from 6.7% in June. Inflation is expected to remain elevated through 2026 and early 2027, as higher global commodity prices, particularly energy prices, continue to feed into domestic costs. Worsening El Niño conditions are also expected to place further pressure on agricultural and food prices, while the effects of Hurricane Melissa continue to weigh on domestic supply.
• The US-Iran conflict remains a key source of uncertainty for Jamaica’s inflation and monetary policy outlook, with oil prices rising above US$100/barrel in September and fuel prices increasing sharply. Diesel prices have risen 53.7%, while transportation inflation accelerated to 14.6% year-over-year (YoY) in August, increasing the risk that higher energy costs become more broadly embedded in domestic prices.
• Overall, the policy rate is projected to end 2026 at 6.50% before easing to 6.00% in 2027, as inflation gradually returns toward the BOJ’s target in the second half of 2027 (H2 2027). However, the trajectory remains highly dependent on the duration of the US-Iran conflict and the resulting impact on global energy prices, with a prolonged conflict presenting upside risks to both inflation and interest rates.

(Sources: BMI, A Fitch Solutions Company & NCBCM Research)

• Jamaica’s trade deficit widened by US$218.9Mn to US$3,103.6Mn for January to June 2026, as higher import expenditure coincided with a decline in export earnings. The export-to-import coverage ratio declined to 20.9%, from 23.5% in the corresponding 2025 period. This implies that the country earned approximately US$0.21 for every US$1.00 spent on imports.
• Total spending on imports for the first six months of 2026 was valued at US$3,921.4Mn, representing a 4.0% increase compared to US$3,770.3Mn recorded in January to June 2025. The increase was mainly driven by higher expenditure on Raw Materials/Intermediate Goods (+4.7%) and Fuels and Lubricants (+6.7%).
• Earnings from total exports were valued at US$817.8Mn, representing a 7.7% decline compared to the US$885.7Mn earned in the corresponding 2025 period. The decline was primarily driven by a 43.0% reduction in the export value of Crude Materials excluding Fuels.
• Jamaica’s top five import trading partners during the period were the United States, China, Colombia, Japan and Trinidad and Tobago. Combined imports from these countries totalled US$2,596.7Mn, representing an 18.3% increase compared to US$2,195.5Mn recorded in the previous corresponding period.
• On the export side, Jamaica’s main markets were the United States, Russian Federation, Netherlands, United Kingdom and Canada. Export revenues from these countries increased by 2.1% to US$595.9Mn.
• Ultimately, the widening trade deficit implied that more foreign currency is leaving the country to finance imports relative to the foreign exchange earned from merchandise exports.

(Sources: STATIN & NCBCM Research)