• As at the end of October 2021, Net International Reserves (NIR) stood at US$3,868.07Mn, a 4% (US$96.15Mn) decrease relative to September 2021.
• A 2.0% (or US$94.47Mn) decrease in total foreign assets and a 0.2% increase in foreign liabilities were behind the reduction.
• The NIR for October translated to 45.70 weeks of goods imports, which is lower than the 46.62 weeks reported at the end of September. It also translated to 32.62 weeks of goods & services imports at the end of October (33.27 weeks: September 2021). The drop in NIR and the slight decline in import coverage could likely be influenced by a rise in the estimated cost of imports as energy prices, input and freight costs have been rising.
• At the current level, Jamaica’s NIR remains well-above the international benchmark of 12-weeks of imports.

(Sources: Bank of Jamaica & NCBCM Research)

• Effective Tuesday, November 9, 2021, Jamaica began the administration of Pfizer first dose to children 12 years and older.
• The rollout will take place predominantly in schools and will help to facilitate the re-commencement of face-to-face learning in schools on a wider scale. The reopening will benefit numerous listed companies across the transportation, manufacturing and distribution sectors.
• Transjamaica Highway for instance should see an increase in motorist activity following the re-opening of schools as parents transport their kids to school. This should bolster the improvement in profitability witnessed thus far this financial year as revenues are currently up 15% for the nine-months ended September 2021, and the net loss of US$3.8Mn reported for the same period in 2020 has been transformed into a net profit of US$1.8Mn for the current year.
• Manufacturers and Distributors such as LASM, Wisynco, Purity and others should also realise an expansion in sales revenues and net profit as the demand from schools for snacks and beverages comes back on stream.

(Sources: JIS News & NCBCM Research)

• Production within Guyana’s manufacturing sector remained positive throughout the first half of 2021, with output increasing 13.1%, according to the Bank of Guyana.
• Based on statistics from the Central Bank’s mid-year report, this performance is a significant improvement, considering that the sector contracted by 0.2% at the end of the corresponding period last year.
• According to the central bank “This outturn reflected a 23.1 per cent rise in output of ‘other’ manufacturing, and 3.1 per cent increase in rice manufacturing, which together offset the decline of 17.2 per cent in the value-added of sugar.”
• “Other manufacturing industries registered increases in the categories of alcoholic beverages by 48.0 per cent; paints by 34.3 per cent; Malta by 20.3 per cent; liquid pharmaceuticals by 10.4 per cent; nonalcoholic beverages by 9.4 per cent; and electricity by 3.8 per cent, as economic activity thrived due to the reopening of the economy,” the Bank related.
• The improvement in the manufacturing sector will support the country’s projected 21.1% growth rate. After expanding by 43.5% in 2020, Guyana will be a regional and global growth outperformer in 2021 and 2022 as well. While this growth in manufacturing will influence the 2021 expansion, surging oil production and inbound investment will be the main drivers of growth. Easing COVID-19 restrictions and government stimulus will also aid commercial activity in the short-to-medium term.

(Sources: Guyana Chronicle & NCBCM Research)

• Fitch Solutions forecasts the Banco Central de Costa Rica (BCCR) will maintain its policy interest rate at 0.75% in 2021 and then hike by 50 basis points (bps), to 1.25%, in 2022 as global monetary policy tightens and unemployment falls closer to pre-pandemic levels.
• As the US Federal Reserve (Fed) begins to raise interest rates in 2022 and 2023, it will prompt the BCCR to also hike rates to maintain a competitive real interest rate differential.
• Costa Rican inflation will rise to 2.4% y-o-y by end-2021, from 1.0% at the start of the year, and average 2.9% in 2022, as rising oil prices drive up transport prices in the coming quarters. The projected rise in inflation is within the BCCR’s target range of 2.0% to 4.0%.

(Source: Fitch Solutions)

• Private equity dealmakers are descending on Berlin for their annual get-together, with their industry thriving and many of them wondering how long the good times will last.
• Armed with billions of dollars, buyout firms have already taken advantage of what has been a record year for mergers and acquisitions (M&A), selling some of their assets for top dollar.
• Private equity-backed M&A deals more than doubled to a record $818.4 billion in the first nine months of this year, up from $315.2 billion last year, according to Refinitiv.
• The S&P private equity index, meanwhile, is up 43% so far this year, compared with a 25% gain in the benchmark S&P 500. In addition, the private equity industry's median internal rate of return was 33% as of March 2021, the highest on record, according to data provider Pitchbook.
• Given the global trend, there exist opportunities locally for private investing, both from the fund and investor perspectives. There are opportunities for PE investors to acquire stakes in companies in growth sectors such as E-commerce, Information Technology, and Business Process Outsourcing, as well as in depressed sectors such as Entertainment and Tourism.
• Consequently, investors with a higher risk appetite looking to diversify their portfolio holdings may find value from private equity funds relative to traditional equity investments. Though private equity has its risks, as an investment asset it has the potential to provide strong returns, offer diversification, and could improve the resilience of investment portfolios.

(Sources: Reuters & NCBCM Research)

• Prices paid to U.S. producers accelerated in October, largely due to higher goods costs, fueling concerns about the persistence of inflationary pressures in the economy. 
• The producer price index for final demand increased 0.6% from the prior month and 8.6% from a year earlier, matching forecasts, Labour Department data showed Tuesday. Excluding the volatile food and energy components, the so-called core PPI rose 0.4% and was up 6.8% from a year ago.
• The report underscores how transportation bottlenecks, materials shortages and increasing labour costs have sent prices soaring across the economy in recent months. And with ongoing supply-chain challenges anticipated to linger into 2022, sustained price increases at the producer level presage additional consumer price increases in the coming months.

(Source: Bloomberg)

• The Bank of Jamaica’s Financial Policy Committee indicated that, notwithstanding the on-going effects of the COVID-19 pandemic, the Jamaican economy showed signs of improvement during the June and September 2021 quarters. In this context, the performance of the financial system improved during the review period. The financial system continued to be well-capitalised and reflected improvements in liquidity and profitability. This observation was made in the Committee’s review of the financial system’s performance and risks. 
• Credit growth during the June and the September 2021 quarters was generally muted. The financial system also did not demonstrate any significant change in institutions’ exposure to selected sectors. The sector continued to report good asset quality even as the stock of loans under moratoria provided by banks continued to fall as payment accommodations expired. Financial institutions remained largely resilient to simulated financial shocks and there were no notable changes in contagion risks. 
• Uncertainties remain about the duration of the COVID-19 pandemic and its impact on households and businesses. Consequently, the supervisors of the financial system will continue their enhanced monitoring to ensure that the system remains sound.

(Source: BOJ)

• Minister of and Health Wellness, Dr. the Hon. Christopher Tufton, on Sunday, November 7, announced that almost three weeks ahead of target, Jamaica has administered one million COVID-19 vaccine doses. 
• The Minister, who on Saturday was in Falmouth participating in a house-to-house vaccination tour, said he is heartened by the kind of response the Ministry has been getting from the vaccination blitzes, adding that this is certainly a step in the right direction. 
• Reaching one million doses is a psychologically significant development and it shows that more Jamaicans are coming on board. This milestone indicates that probably 23% to 24% of the targeted population has been fully vaccinated and the government is now moving ahead to get as many persons vaccinated as possible in coming weeks. 
• A key focus is the vaccination of children and the Ministry wants to appeal to parents and guardians to give as much support as possible, especially when the first dose of the Pfizer vaccine is administered to children, to try and get them back into the schools. 
• The Minister also reiterated that following directives from the World Health Organization, booster shots (third doses) will be available for persons with serious illnesses such as cancer, cardiovascular disease, diabetes and other pre-existing medical conditions. This he said will be given to those who have had the two doses of the Astra Zeneca or Pfizer and in the case of the singular Johnson and Johnson one additional shot.

(Source: JIS News)

• The Central Bank of the Bahamas (CBOB) says inflation has risen to 0.90 percent up from 0.88 percent within the period of June 2020 to June 2021. 
• The bank recently reported that crude oil prices continued to rise this year, following unprecedented lows in 2020, with prices of goods and services rising in most categories to date. 
• According to the central bank's monthly economic and financial developments in September there was a 42.3 percent increase in crude oil prices from January to September this year to B$72.94 a barrel. 
• Consequently, average clothing and shoe prices rose 12.7 percent, despite falling to 8.4 percent last year.  Additionally, miscellaneous goods and services (2.7 percent), food and non-alcoholic beverages (2.3 percent), and housing, water, gas, electricity and other fuels (1.3 percent) recorded an increase in average costs following a year-on-year decline.

(Source: The Central Bank of the Bahamas)

• Remittances and the tourism sector have generated income to the Dominican Republic Government of US$11.9 billion in the first nine months of 2021. 
• According to data from the Central Bank of the Dominican Republic (BCRD), tourism revenues stood at US$3.8 billion, 90.2% above the January-September 2020 record. 
• Likewise, during the first nine months of the year, remittances reached US$7.9 billion, 34.4% more than in January-September 2020 and 48.5% above the same period of 2019. 
• 85% of the remittances received in the country come from United States, 6.7% Spain, 1.0% Haiti, among others. Official data indicate that since 2010, citizens in the Dominican Republic received a total of US$66.3 billion, 2020 was the year that more remittances were issued to the country. However, 2021 is on pace to exceed it. 
• This strong performance will support IMF’s 9.5% projected growth for 2021. Further, tourism inflows will bolster government revenues and help to narrow the fiscal deficit to 4.4% in 2021 from 8.0% in 2020.

(Source: Dominican Today & NCBCM Research)