Trinidad and Tobago: A Full Year of Holding Rates  

• Ongoing and emerging geopolitical factors are clouding the external economic policy outlook for 2024, the Central Bank of Trinidad and Tobago stated in its Monetary Policy announcement for December.
• Domestically, macroeconomic conditions appear favourable based on the retreat of inflation, sustained private sector credit growth, and robust non-energy sector activity.  However, short-term TT/US interest rate differentials remain a concern for the external balance, but could narrow further based on the projected downward path of foreign rates.
• The Central Bank stated that in reviewing external developments, the Monetary Policy Committee (MPC) took particular note of the rapid slowdown in global inflation and the less aggressive monetary stance adopted by major central banks.
• Given these factors, the MPC agreed to maintain the repo rate at 3.50%. At the same time, the MPC considered that the dynamic nature of external economic developments in 2023, their repercussions on Trinidad and Tobago's open economy, and the expected continuation of that situation in 2024 warranted continued vigilance and agility on the part of the Central Bank to potentially rapidly changing circumstances.
• The MPC also noted that the Central Bank will continue to carefully monitor and analyse international and domestic developments and prospects going forward.

(Sources: Trinidad Express Newspaper and Central Bank of Trinidad and Tobago)