• Fitch Solutions’ forecast for global growth in 2021 edged lower in November to 5.5% from 5.6% in October, largely on the back of several downward growth revisions to the US (6.0% to 5.6%), Germany (3.7% to 2.8%), Spain (6.8% to 5.0%), Mexico (6.0% to 5.7%) and Saudi Arabia (3.0% to 2.8%). 
• These downward revisions were partially offset by upward revisions to several large economies, including France (5.9% to 6.8%), Italy (4.6% to 6.2%), Malaysia (0.0% to 1.5%), Russia (3.4% to 3.8%) and Turkey (6.3% to 8.3%). Fitch’s global growth forecasts for 2021 (5.5%) and 2022 (4.2%) remain slightly below consensus estimates of 5.9% and 4.5% respectively. 
• The latest high frequency and GDP data pointed to a slowdown in economic activity in Q321 due to a combination of less favourable base effects, supply chain-related challenges and new COVID-19 outbreaks, which forced several economies to re-impose partial restrictions. 
• Moreover, the recent increase in energy prices has weighed on output in a number of economies, further curbing growth momentum. The good news is that the latest purchasing managers' index (PMI) readings show that activity started Q421 on a stronger footing, pointing to a still-strong global economic performance in the last quarter of 2021.

(Source: Fitch Solutions)

• Banks largely eased credit standards for businesses, commercial real estate investors and households in the third quarter of the year, as the U.S. economy weathered the latest wave of the coronavirus pandemic, a Federal Reserve survey reported on Monday. 
• The Fed's Senior Loan Officer Survey, offering evidence of continued momentum for the economy, said banks "generally reported having eased standards" for business loans by lowering rates, expanding credit lines or imposing less restrictive terms. 
• The banks "cited a more favourable or less uncertain economic outlook" as well as more competition among lenders and "an increased tolerance for risk" amid general improvement in markets and the economic outlook, the Fed reported. Demand for loans was also up, particularly among middle-sized and larger firms.

(Source: Reuters)

• Jamaica has been removed by the United States Centers for Disease Control and Prevention (CDC) from its level-four “Avoid Travel to this Destination” risk assessment, which is a very positive development for our tourism sector. 
• The Minister of Tourism commended the health authorities and the people of Jamaica for working to bring down the rates of COVID-19 infections and hospitalisations, which augurs well for Jamaica’s risk assessment rankings. He noted that beyond that, the Resilient Corridor remains a very safe space for visitors and workers alike with comparatively high vaccination rates and extremely low infection rates. 
• Jamaica is now ranked at level three, which urges US travelers to be fully vaccinated before travelling. Despite CDC risk assessments, Americans by and large continue to travel to destinations they want to visit. 
• Bartlett said there is no room for complacency. Jamaica will continue to follow and be guided by international standards relating to the COVID-19 protocols, ensuring that its economy and tourism sector can get back to normal as quickly as possible. 
• This development will certainly complement the efforts being made to boost tourist arrivals including the increase in air traffic by airline companies such as Frontier. It will also aid in the overall recovery of the tourism sector and the wider economy. Currently, Jamaica is projected to welcome 1.57Mn and 3.2Mn tourists in 2021 and 2022, respectively and will be “well on its way to recovery” in 2023 with an anticipated 3.7 million visitor arrivals and inflows of US$3.7 billion.

(Source: JIS News & NCBCM Research)

• Jamaica has gained new connections to a wider European travel market with the commencement of direct flights via Eurowings Discover from Frankfurt, Germany, to the Sangster International Airport in Montego Bay, St. James. 
• Regional Director of the Jamaica Tourist Board (JTB) in continental Europe, Gregory Shervington, told journalists that the arrival of the plane signals the commencement of nonstop direct service to Montego Bay twice per week. 
• In terms of seat capacity, Eurowings adds substantial capacity and convenience as they are the only airline, which offers nonstop service in both directions from Germany to Jamaica now. Mr. Shervington said that the airline’s decision to start new flight service from Germany to Jamaica can only bolster the country’s image on the international stage. 
• For his part, Eurowings Discover’s Director of Network Airport Relations, Rupert Kraus, said that with the new flight service, there is the capacity to shuttle approximately 15,000 passengers over the winter tourist season to Montego Bay. This will could help Jamaica to record a strong winter season and potentially improve the speed of recovery in the sector.

(Source: JIS News & NCBCM Research)

• Fitch Solutions maintained its view that Latin American governments are unlikely to advance market-oriented reforms in the coming quarters due to public opposition to spending cuts, divided legislatures and other idiosyncratic risk factors. 
• As a result, Latin America's average score in Fitch’s Reform Tracker has fallen to 3.4 out of 10 in Q421, from 3.5 in Q321 and a high of 5.4 in Q419. 
• In upcoming elections in Chile, Colombia and Brazil, candidates campaigning against reform efforts initiated over recent years appear to be frontrunners, weakening reform prospects in the medium term.

(Source: Fitch Solutions)

• The Central Bank left the target policy rate unchanged at 3%, while the 1d repo rate and the overnight rate remained at 3.5% and 2.5%, respectively. The CB reiterated its view that inflationary pressures are largely due to temporary global supply shocks resulting in spikes of oil and other commodity prices, as well as logistical issues such as scarcity of shipping containers. 
• On the domestic front, beef prices have also fueled inflation. The authorities still expect inflation to converge towards the target range of 4.0% +or- 1.0% by mid-2022. In the meantime, the CB is gradually withdrawing the liquidity programs introduced during the pandemic. 
• The Bank indicated that economic activity expanded by 12.7% during the first nine months of the year, and that GDP is likely to expand by more than 10% in 2021. 
• It also acknowledged that domestic demand is recovering on the back of the various stimulus programs and the successful vaccination campaign, with strong performance of construction, local manufacturing, commercial activities, and free zones.

(Source: Oppenheimer)

• World food prices rose for a third straight month in October to reach a fresh 10-year peak, led again by increases in cereals and vegetable oils, the UN food agency said on Thursday. 
• The Food and Agriculture Organization's (FAO) food price index, which tracks international prices of the most globally traded food commodities, averaged 133.2 points last month compared with a revised 129.2 for September. 
• The October reading was the highest for the index since July 2011. On a year-on-year basis, the index was up 31.3% in October. 
• Agricultural commodity prices have risen steeply in the past year, driven by harvest setbacks and strong demand.

(Source: Reuters)

• The Bank of England kept interest rates on hold on Thursday, wrong-footing investors who had been convinced that it would be the first of the world's big central banks to raise borrowing costs after the COVID-19 pandemic. 
• The BoE kept alive the prospect of a move soon, saying it would probably have to raise bank rate from its all-time low of 0.1% "over coming months" if the economy performed as expected. 
• But seven of its nine policymakers voted to leave rates unchanged for now - even as they forecast inflation would reach almost 5% in April - so they can see how many people lose their jobs after the recent end of the government's furlough scheme. 
• The announcement sent shockwaves through markets, sending sterling towards its biggest fall since the early days of the COVID-19 pandemic in March 2020.

(Source: Reuters)

• The Government is seeking to ensure that wide-ranging legislative and product provisions being targeted for implementation and delivery under the proposed Micro-insurance Bill redound to the benefit of all Jamaicans, especially the most vulnerable. 
• Micro-insurance looks to assist low-income persons by offering insurance plans tailored to their needs. Key among the provisions, is the fit and proper requirements for potential service providers, who have to be registered. The Minister of Finance said in addition to defining micro-insurance and specifying the relevant products to be offered, the legislation will require that these offerings have stipulated minimum terms and conditions and that all be administered under formal contractual arrangements. 
• Clarke maintained that this will be crucial to properly service the market where incomes are in a number of instances low and there are a lot of demands on income. The legislation will require that claims be resolved and paid out within five days, so that the experience of the insured is such that the micro-insurance is seen as one that adds value. 
• Work on the Bill’s development is currently advanced, and it is expected to be tabled in Parliament before the end of the 2021/22 fiscal year, on March 31, 2022. It is anticipated that the legislation will be passed during the 2022/23 fiscal year, which starts on April 1, 2022. 
• The development and implementation of a micro-insurance policy framework forms part of the Government’s thrust to broaden the base of the economy and deepen its inclusiveness by making insurance accessible to all Jamaicans.

(Source: JIS News)

• Deputy Mayor of Montego Bay, Councillor Richard Vernon, says Frontier Airlines’ inaugural flight from Atlanta, Georgia, to Sangster International Airport in Montego Bay, is a show of confidence in the country’s management of the coronavirus (COVID-19) pandemic. 
• Vernon said that increasing the number of flights into Montego Bay and Jamaica, by extension, sends the message that Jamaica is safe for travel. Mr. Vernon noted that new flights also mean new business for Montego Bay, particularly when the direct flight is coming out of Atlanta, which is the sister city that Jamaica has shared such a close relationship with for many years. 
• This new Frontier Airlines flight route opens the door for more support from the diaspora. Further, having nonstop flights mean persons can travel freely, and business can be transacted at a faster pace. 
• It also augurs well for recovery in the tourism industry and indicates that there is demand for travel to Jamaica. As at July 2021, there have been 716,221 tourist arrivals, which is below the 1.07Mn and 2.64Mn reported in 2020 and 2019, respectively. The Government is forecasting 1.57Mn visitors and more than US$2.0Bn in earnings for this year.

(Source: JIS News & NCBCM Research)