• The International Monetary Fund (IMF) has commended Guyana’s rapid economic transformation and strong macroeconomic performance following the conclusion of its 2025 Article IV Consultation. Guyana’s economic transformation is advancing strongly and broadening in scale. Rapidly expanding oil production, strong non-oil output, and large-scale public infrastructure investment supported the highest real GDP growth rate in the world, averaging 47% per year since 2022.
• Despite the strong economic performance, inflation reached 2.9% by the end of 2024, up from 2% in 2023, driven largely by higher food prices.
• In terms of fiscal position, the overall fiscal deficit widened from 5.1% of GDP in 2022 to 7.3% of GDP in 2024, reflecting a large increase in capital expenditure.
• That said, driven by higher oil exports, Guyana’s current account surplus more than doubled in 2024, reaching about 24.5% of GDP. Consequently, gross international reserves surpassed US$1Bn, while the Natural Resource Fund (NRF) accumulated over US$1.1Bn in 2024, reaching US$3.1Bn (over 12.5% of GDP).
• Looking ahead, the economy is expected to grow, inflation should rise slightly and the fiscal deficit and the current account surplus should narrow. The economy should grow on average by 14% per year over the next five years, driven by robust oil production and strong non-oil GDP growth. Positive spillovers from the oil sector and improvements in infrastructure, productivity, and resilience are also expected to boost the real non-oil GDP growth. While inflation is projected to edge up to around 4% in 2025, the overall fiscal deficit and the current account surplus are expected to narrow in 2025.
• Risks to the outlook are broadly balanced. On the upside, additional oil discoveries and productivity-enhancing investments, including strengthening energy resilience, would further bolster Guyana’s long-term economic prospects, while expanding construction activity would support higher short-term non-oil GDP growth. Downside risks stem from overheating pressures, which, if not contained, would lead to higher inflation and a real exchange rate appreciation

• The Bank of England (BOE) cut its main interest rate by 0.25 percentage points to 4.25% on Thursday, May 8, 2025.
• The minutes of the Bank's meeting showed the rate-setting committee was divided. Of the nine members, five voted to cut rates to 4.25%, two voted in favour of a larger reduction to 4%, and two voted for no change.
• "The Monetary Policy Committee is clearly very divided on how policy should respond to the many shocks currently hitting the economy. This is highly unusual and will make it hard for the Bank to send a clear signal to the market about the likely path of policy. But with the bank maintaining its guidance that further cuts will be 'gradual and careful', the chance of another cut in June probably has fallen significantly", said Luke Bartholomew, Deputy Chief Economist of Aberdeen London:
• Most recent U.K. inflation figures show prices rose 2.6% in the year to March. However, the rate is expected to jump following a series of household bill increases at the start of April, including energy and water prices.
• Inflation is expected to rise "temporarily" to 3.5% this year due to the bill increases before falling back due to lower oil and gas prices set to feed through in the coming months.
• That said, the Bank expects UK growth for the first three months of this year to be stronger than it originally forecast at 0.6%, boosted by U.S. firms stockpiling goods ahead of Trump's tariffs coming into effect. The official figures are set to be released next week. A boost in growth would be welcomed news to the government, which has made growing the economy its main priority to boost living standards.

(Source: Reuters & BBC)

• U.S. President Donald Trump and British Prime Minister Keir Starmer on Thursday, May 8, 2025, announced a limited bilateral trade deal that leaves in place Trump's 10% tariffs on British exports, modestly expands agricultural access for both countries, and lowers prohibitive U.S. duties on British car exports.
• The preliminary agreement is the first of dozens of tariff-lowering deals that Trump is trying to land in the coming weeks after blitzing the global economy with steep new import taxes in a bid to reshape global trade in the U.S.'s favour and shrink a US$1.2Tn U.S. goods trade deficit.
• Trump downplayed the U.K. deal as a template for other negotiations, saying that Britain "made a good deal" and that many other trading partners may end up with much higher final tariffs because of their large U.S. trade surpluses.
• In April, Trump imposed reciprocal duties of up to 50% on goods from 57 trading partners, including the European Union, pausing them days later to allow time for negotiations. At the same time, he heaped new 25% tariffs on auto imports and ended all exemptions on steel and aluminium duties, announcing new tariff probes on pharmaceuticals, copper, lumber and semiconductors.
• At a White House press conference with Starmer patched in on a speaker phone, the two leaders heralded the plan as a "breakthrough deal" that lowers average British tariffs on U.S. goods to 1.8% from 5.1%.

(Sources: Reuters)

• Wisynco Group Limited saw its net profit decline 17.5% year-over-year to $971.36Mn, despite continued top-line growth. This softer outturn was driven by margin compression and increased operating expenses, which offset the impact of higher sales.
• Q3 revenues rose 4.8% year-over-year to 13.7Bn, supported by resilient demand for core brands. However, the company still faced headwinds from softer activity across all markets as its export revenues were hampered due to logistics issues in its major markets.
• Cost of sales outgrew revenues, up by 6.0% to $9.22Bn, narrowing gross profit margin by 33 basis points to 32.8%.
• There was further downward pressure on net profits as Selling, distribution and administrative (SD&A) expenses grew by 10.7% to $2.94Bn, outpacing both revenue and gross profit growth. The company noted that its SD&A-to-sales ratio climbed to 21.4%, from 20.3%. As a result, operating profit contracted by 16.5% to $1.09Bn. Still, management expects that additional revenue streams will reduce the ratio.
• Ultimately, the 17.5% Q3 earnings decline contributed to a 12.4% decline for the nine months ended March 2025. Despite the decline in 9M 2025 earnings, Wisynco continues to generate strong cash flows, albeit lower than last year. Net cash provided by operating activities totalled $4.18Bn, reflecting continued profitability and prudent working capital management. These inflows helped support $2.77Bn in capital expenditure as it nears the end of its CAPEX cycle, where it invested in various plant expansions, including new warehouse space and adding new beverage lines to meet local and untapped export demand.
• At market close on Wednesday, Wisynco’s stock was $20.95, down 2.3% from the start of the year. At its current price, Wisynco trades at a P/E of 15.29x, which is below the Main Market Distribution & Manufacturing Sector average of 15.43x.

(Source: Wisynco & NCBCM Research)

• Brazil's central bank raised interest rates by 50 basis points on Wednesday in a sixth straight hike that pushed borrowing costs to their highest in nearly 20 years, and left future steps open amid global uncertainties and sticky domestic inflation. The bank's monetary policy committee, known as Copom, raised the Selic to 14.75% in a unanimous decision, matching forecasts from 32 of 35 economists in a Reuters poll.
• Policymakers stressed that the current environment calls for a "significantly contractionary monetary policy for a prolonged period" to bring inflation to target, dropping previous language about the need for "a more contractionary" stance.
• Flavio Serrano, chief economist at BMG Bank, said the central bank left the door open for a smaller rate hike in June if needed, though he sees it as unlikely. "My base case is zero increase in June, holding at 14.75%. There may be room for a cut at the very end of the year, depending on how the outlook evolves," he said.
• In March, the central bank had already flagged the need for further tightening this month, though at a slower pace than the previous three 100 basis-point hikes. With Wednesday's move - announced just hours after the U.S. Federal Reserve held rates steady but cited the risk of rising inflation and unemployment - the Selic benchmark rate has now reached its highest level since August 2006.
• The sky-high rates come against a backdrop of a 5.49% annual inflation rate, well above the official 3% goal, with markets sceptical that inflation will return to target even by as far out as 2028.

(Source: Reuters)

• Trinidad and Tobago’s (T&T) economy is expected to grow by 1.3% in 2025, supported by expected increases in hydrocarbon production and stable domestic consumption.
• Following years of declining hydrocarbon production, Fitch Solutions forecast a reversal of this trend in 2025, with an uptick in overall hydrocarbon production and exports.
• While liquefied natural gas (LNG) production saw year-on-year declines in the first half of 2024 (H1 2024), data from H2 2024 and the first quarter (Q1) of 2025 indicate an upward production trend. Output rose by 12.8% year-over-year (YoY) in Q4 2024 and by 7.7% in January 2025.
• Fitch’s Oil and Gas team forecasts full-year growth at 2.0%. Furthermore, given the importance of Trinidad and Tobago’s energy sector to the overall economy and exports (energy accounted for 82.5% of exports in Q3 2024), expected increases in overall hydrocarbon output in 2025 are a welcome development, though declining prices pose risks to growth.
• Building on increased production and exports in 2025, Fitch anticipates a larger uptick in total hydrocarbon production in 2026 as new fields come online, boosting exports and supporting growth.
• However, T&T’s energy sector suffered a setback in April 2025, with the U.S. government rescinding existing licenses to Shell and BP to develop the Dragon and Manakin-Cocuina gas fields – joint developments with Venezuela – to increase pressure on President Maduro’s government. While Fitch’s forecast does not factor in increased output from these projects, this is a setback for T&T’s gas industry moving forward.

(Source: Fitch Connect)

• The United States’ (U.S.) Federal Reserve (Fed) held interest rates steady on Wednesday, May 7, 2025, but said the risks of higher inflation and unemployment had risen, further clouding the economic outlook as the U.S. central bank grapples with the impact of Trump administration tariff policies.
• The economy overall has "continued to expand at a solid pace," the Fed said in a policy statement, attributing a drop in first-quarter output to record imports as businesses and households rushed to front-run new import taxes.
• The labour market also remained "solid" and inflation was still "somewhat elevated," the central bank's policy-setting Federal Open Market Committee (FOMC) said, repeating the language used in its previous statement. But the latest statement highlighted developing risks that could leave the Fed with difficult choices in the coming months.
• "Uncertainty about the economic outlook has increased further," the FOMC said at the end of a two-day meeting during which officials agreed unanimously to keep the central bank's benchmark interest rate steady in the 4.25%-4.50% range. "The Committee is attentive to the risks to both sides of its dual mandate and judges that the risks of higher unemployment and higher inflation have risen," the statement said.
• The direction of policy will depend on whether job or inflation risks develop, or, in the more difficult outcome, whether inflation and unemployment increase together and force the Fed to choose which risk is more important to try to offset with monetary policy. A weaker job market would typically strengthen the case for rate cuts; however, higher inflation would call for monetary policy to remain tight.
• The Fed's policy rate has been unchanged since December as officials struggle to estimate the impact of President Donald Trump's import tariffs, which have raised the prospect of higher inflation and slower economic growth this year. When policymakers last updated their projections in March, they anticipated reducing the benchmark rate by half a percentage point by the end of this year.

(Source: Reuters)

• Britain is in "active discussions" with top U.S. officials over the 100% tariff on all movies produced outside the U.S. announced by President Donald Trump, as it aims to protect one of its biggest creative industries.
• Importantly, Britain has a leading film and TV production industry, centred on studios located close to London. Production spending on films in Britain in 2024 totalled $5.91Bn, according to ProdPro, compared with $14.54Bn in the United States.
• "We are already in active discussions with the top of the U.S. administration on this subject. We are working hard to establish what might be proposed, if anything, and to make sure our world-beating creative industries are protected," Creative Industries Minister, Chris Bryant, told parliament on Wednesday, May 7, 2025.
• Bryant noted that Trump had not given any details about his proposal, adding that it was not clear how tariffs could be applied to the film industry, with productions often created and developed across different locations and countries.
• The entertainment industry was left flummoxed on Monday by Trump's announcement of tariffs, with executives questioning both the timing of the proposed levy and how it could be enforced.

(Sources: Reuters)

• Carib Cement Limited (CCC) has reported a 3.4% increase in its Q1 2025 net profits to $1.99Bn, as a 7.7% revenue increase compared to Q1 2024, was pegged back by higher expense growth.
• Revenue growth was met by a 10.4% rise in direct costs to $4.43Bn, reflecting higher fuel and electricity expenses and increased personnel costs. Despite this, gross profit improved 9.2% to J$3.38Bn.
• Operating expenses (+22.8%) also outpaced revenue growth. The largest driver was administrative expenses, which cover personnel, services and equipment depreciation and grew by 68.4% to $0.35Bn. The other contributors to operating expenses – Selling, distribution and impairment expenses – grew by 2.7% in aggregate to $0.48Bn.
• On the other hand, operating profit benefited from a reduction in “other expenses”, down by 14.5% to $0.27Bn due to a $40.5% increase in finance income to $0.09Bn and the absence of foreign exchange losses in Q1 2024. However, there was a 56.3% increase in management fees during Q1, which partially offset the overall decline in 'other expenses. Effective January 1, 2025, management fees, in the form of royalty and service fees, were raised from 2.0% to 3.0% of the company’s net sales¹.
• CCC’s $1.99Bn net profits supported operating cash flows totalling $2.3Bn, but was down $0.72Bn due to rising working capital. Notably, during Q1, the company directed $1.1Bn toward capital expenditure (CAPEX) as part of its ongoing plant upgrade.
• Carib Cement has now entered the critical construction phase of its major kiln upgrade project, with the installation of ducts, electrical systems, and other key infrastructure currently in progress.  The US$40Mn capacity expansion project, which is scheduled for completion later this year, will enhance its ability to meet local demand. The project will also position the company to benefit from significant government-led infrastructure initiatives, including roadworks and housing developments, with public expenditure expected to reach one trillion Jamaican dollars over the next five years.
• At market close on Tuesday, CCC’s price was J$82.14, down 2.80% since the start of the year. At its current price, the company trades at a P/E of 11.82x, which is above the Main Market Energy, Industrials and Materials Sector average of 15.54x.

______________________

¹ A maximum royalty fee of 4% of consolidated net sales has been established for the use of intellectual property owned by CEMEX and licensed to the Company, under terms approved at the December 7, 2021 Annual General Meeting.

 (Source: CCC & NCBCM Research)

• Despite a moderate increase in total gaming income (+3.87% YoY), Supreme Ventures Limited’s (SVL’s) earnings declined by 41.56% to $508.29Mn for Q1 2025. The decline was largely driven by a disproportionate spike in operating expenses.
• A 5.0% rise in income from fixed-odd wagering games and a 3.3% increase in revenue from non-fixed-odd wagering games, horse racing, and pin codes resulted in total gaming income rising to $13.83Bn from $13.31Bn.
• Direct costs rose by 3.8% to J$10.67Bn in Q1 2025 due to higher sales volume, but gross profit still improved by 6.4% to reach J$3.16Bn, reflecting efficiency in cost containment relative to revenue growth.
• That said, a sharp 33.4% increase in operating expenses, which jumped to J$2.21Bn in Q1 2025, was the main contributor to lower earnings. In addressing the jump in operating expenses, group chairman Garry Peart noted that depreciation following increased CAPEX –driven primarily by capital work in progress, motor vehicles, lottery equipment and leasehold equipment – and the absence of a write-back drove the increase. “Last year, the reported figure was about $1.6 billion, but that included a $300 million write-back. So, if we adjust for that, the true base was closer to $1.9 billion. On that basis, the year-over-year increase is actually more in the range of 10 to 12%...”, said Peart on SVL’s Q1 2025 investor briefing.
• Despite the rising costs, Management remains optimistic about the long-term growth of the business, pointing to several of its ventures, most notably its Fintech and Ghana expansions that are approaching break-even.
• At the market close on Tuesday, SVL’s stock price was J$19.93, down 19.41% since the start of the year. At this price, SVL trades at a P/E of 36.14x, which is above the Main Market average of 13.32x.

(Source: SVL & NCBCM Research)