Latest News

Bank of Jamaica Lowers Policy Rate Published: 28 March 2019

  • The Bank of Jamaica announced its decision to lower its policy interest rate by 25 basis points to 1.25%. The reduction will take effect on March 28, 2019.
  • The decision to lower the policy rate is aimed at supporting inflation reaching the target of (4.0% to 6.0%) by December 2020.
  • The rate reduction is intended to stimulate faster expansion in private sector credit which should lead to higher economic activity, consistent with the inflation target.

(Source: BOJ Press Release)

Jamaica’s mining revival turns red earth to gold for hedge funds Published: 28 March 2019

  • The once-giant American company Kaiser Aluminum, which started mining here in 1967 is at the leading edge of a revival of the mining industry, turning Jamaica’s red earth to gold for a new set of investors from hedge fund luminaries to commodity traders.
  • Now things are turning around for the mines. Noranda, which was bought out of bankruptcy by New Day Aluminum together with an alumina refinery in Louisiana, is planning a 40% increase in production this year after signing a supply deal with a Chinese company. Additionally, the Chinese group Jisco, which bought the mothballed Alpart plant from Rusal, is looking to expand.
  • Parris Lyew-Ayee, executive director of the Jamaica Bauxite Institute has highlighted that good days are ahead for the industry however he does not believe that the glory days will return.

(Source: Yahoo Finance)

The Bahamas’ National Debt Ends 2018 at $8.22Bn Published: 28 March 2019

  • The Bahamas’ national debt finished 2018 at $8.22Bn, having increased by $335.3Mn last year, although GDP growth implied it fell slightly in proportion to the size of the economy.
  • The Central Bank revealed that the country’s total debt - the government’s direct charge plus all borrowings it has guaranteed on behalf of public corporations and agencies - rose by $103.5Mn during the period.
  • However, economic growth was sufficient to ensure that The Bahamas’ debt ratios were kept in check at year-end 2018. The government debt fell from 59% of GDP in 2017 to 58.9% at the end of 2018, with the total debt-to-GDP ratio also down slightly from 64.8% to 64.6% year-over-year.

(Source: Tribune 242)

Rising Exports To Narrow Mexico's Current Account Deficit Published: 28 March 2019

  • Fitch Solutions forecast Mexico's current account deficit to narrow in the coming years, supported by robust manufacturing goods export growth.
  • The modest current account shortfall will be covered by capital inflows, as Mexico remains an attractive investment destination.
  • However, Fitch note risks to this outlook amid policy shifts under President Andrés Manuel López Obrador (AMLO) and uncertainty surrounding the US passage of a revised North American Free Trade Agreement (NAFTA). 

 (Source: Fitch)

U.S. Fourth-Quarter Growth Revised Down to 2.2% From 2.6% Published: 28 March 2019

  • U.S economic growth cooled by more than initially reported last quarter on revisions to consumer and government spending, signaling mounting challenges to the expansion as it nears a record duration.
  • Gross domestic product grew at a 2.2% annualized rate, Commerce Department data showed Thursday, less than the initial 2.6% reading and projections for a revision of 2.3%.
  • Consumer spending, the biggest part of the economy, grew at a downwardly revised 2.5% pace that also missed projections.
  • The final reading on a turbulent quarter that included U.S. stocks tumbling to the cusp of a bear market adds to concerns for the world’s biggest economy as global headwinds gather from Europe to China.

(Source: Bloomberg)

Trump Says OPEC Must Pump More Oil Because Prices Are Too High Published: 28 March 2019

  • U.S President Donald Trump renewed his criticism of OPEC, saying the cartel should increase production because prices are getting “too high.”
  • It is the second time this year the president has taken to Twitter to urge the cartel to backtrack on its current policy of cutting production.
  • Unlike last year, when Trump’s attacks triggered a swift U-turn in Saudi oil policy, the group has so far refused to heed his calls.
  • Oil extended losses in New York, with West Texas Intermediate futures dropping 1.7% to $58.40 a barrel since the start of the day.

(Source: Bloomberg)

Macroeconomic Stability Has Been Entrenched – PIOJ Head Published: 26 March 2019

  • Planning Institute of Jamaica (PIOJ) Director General, Dr. Wayne Henry, noted that macroeconomic stability has been entrenched, evidenced by relatively low inflation, high net international reserves (NIR), successive positive growth, and fiscal discipline, which has significantly lowered public debt.
  • The country’s debt-to-GDP ratio is projected to fall below 100% at the end of the 2018/19 fiscal year, which is the lowest level of debt in nearly two decades.
  • Dr. Henry noted that with the strengthened foundation resulting from the improving macroeconomic out-turns, coupled with on-going efforts to sustain the gains attained, “the country is now [moving] to achieve economic independence”.

(Source: JIS)

More Investment Flowing In For Barbados Published: 26 March 2019

  • At the launch of Sagicor’s Bds$170Mn investment, The Estate at St. George, Prime Minister Mia Mottley reiterated that the country is open for business.
  • The Estates at St. George is an adult, wellness and amenity-driven community with continuing care facilities on 19 acres. The first community of its kind in Barbados and the Caribbean, it will be built over three phases, and once completed, will offer a range of amenities, including a 4.5-acre green space.
  • The infrastructural works have commenced, and the first phase will offer 120 independent living homes for sale.
  • Executive Vice President and General Manager of Sagicor Life Inc., Barbados Operations, Edward Clarke disclosed that following infrastructural work, construction of the first phase would commence in the first quarter of 2020. He added that keys were expected to be handed over to proud homeowners before the end of the following year.  

(Source: GIS Barbados)

UK Signs New Trade Pact with 9 CARICOM Nations. T&T Not Among the Signators Published: 26 March 2019

  • NINE Caribbean Community (Caricom) countries on Friday signed a trade continuity agreement with the United Kingdom that will allow them to trade as they do now without any additional barriers or tariffs.
  • The United Kingdon’s Trade Policy Minister, George Hollingbery, signed the CARIFORUM-UK Economic Partnership Agreement (EPA) with ministers and representatives from Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, St Kitts, and Nevis, St Lucia, and St Vincent and the Grenadines.

(Source: Trinidad Express)

A Flood of U.S. Oil Exports Is Coming Published: 26 March 2019

  • What started as an American phenomenon is now being felt around the world as U.S. oil exports surge to levels unthinkable only a few years ago.
  • American oil exports stepped up a gear last year, jumping more than 70% to just over 2 million barrels a day, according to government data. Over the past four weeks, U.S. oil exports have averaged more than 3 million barrels a day.
  • Oil traders and shale executives believe U.S. crude exports are set to reach 5 million barrels a day by late 2020, up another 70% from current levels. If the U.S. hits that target, America will be exporting, on a gross basis, more  crude  than every country in OPEC except Saudi Arabia.
  • “This will shake up international oil and gas trade flows, with profound implications for geopolitics”, said Faith Birol, the head of the International Energy Agency.

 (Source: Bloomberg)