• The Banco de la República (BanRep) will extend its accommodative monetary policy stance in Colombia in the coming quarters to boost the country’s economic recovery and increase domestic liquidity.
• Anchored inflation, a negative output gap, and a dovish US Federal Reserve will support the central bank's policy direction, which will remain unchanged despite Leonardo Villar's appointment to succeed Governor Juan José Echavarría in January 2021.
• The agency forecasts that BanRep will maintain its policy interest rate at 1.75% in 2021, and that inflation will average 2.7% y-o-y in 2021, from an estimated 2.6% in 2020.

(Source: Fitch Solutions)

• The European Union and China agreed on Wednesday to an investment deal that will give European companies greater access to Chinese markets and help redress what Europe sees as unbalanced economic ties.
• The agreement has been nearly seven years in the making and is likely to take at least another year to enter into force. It forms part of a new relationship with China, which the EU views as both a partner and a systemic rival.
• European firms will gain permission to operate in China in sectors including electric cars, private hospitals, real estate, advertising, the maritime industry, telecom cloud services, airline reservation systems, and ground handling.
• Some requirements that companies operate as part of joint ventures with Chinese partners will be lifted.

(Source: Reuters)

• Britain on Wednesday became the first country in the world to approve a coronavirus vaccine developed by Oxford University and AstraZeneca, hoping that rapid action would help it stem a surge of infections driven by a highly contagious variant of the virus.
• Boris Johnson’s government, which has already ordered 100 million doses of the vaccine, has jumped ahead of other Western countries with its vaccination program.
• It was the first to approve a shot developed by Pfizer of the United States and Germany’s BioNTech, with the result that hundreds of thousands of people were vaccinated in Britain before European Union countries and the United States even began administering it this month

Source: (Reuters)

• The Statistical Institute of Jamaica (STATIN) stated that the inflation rate for November 2020 was 0.6% primarily due to an increase of 1.7% in the heavily weighted ‘Food and Non-Alcoholic Beverages’ division.
• There was a 1.8% rise in the index for the ‘Food’ group, mainly influenced by higher prices for agricultural products such as carrot, cabbage, tomato and sweet pepper as a result of reduced supplies caused by adverse weather conditions.
• For the review period, the calendar year-to-date inflation rate was 5.0%, and the fiscal year-to-date was 3.7% as at November 2020. The point- to-point rate was 4.3% which was at the lower bound of theBOJ’s target range.

(Source: STATIN)

• Fitch Solutions expects Trinidad & Tobago’s (T&T) economy will grow 4.8% y-o-y in 2021 after declining 6.9% in 2020, driven by private consumption and rebounding energy sector exports.
• The agency has revised its 2021 real GDP forecast up from 4.4% y-o-y previously, to reflect a stronger outlook for global energy demand as COVID-19 vaccine distributions support a global economic recovery.
• However, fiscal consolidation and weak investment prospects will slow the pace of recovery, and the economy will reach pre-pandemic levels only in 2023.

(Source: Fitch Solutions)

• Fitch Solutions forecasts Brazil's overall government fiscal deficit will narrow to 9.7% of GDP in 2021, from a historic 18.8% in 2020.
• While revenues will rebound and expenditures will most likely fall as stimulus measures are reduced, the lack of a budget for 2021 leaves significant uncertainty over government spending.
• Together with waning momentum towards enacting structural fiscal reforms, investors will likely remain cautious towards Brazil, limiting the benefits it sees from improving global risk sentiment.

(Source: Fitch Solutions)

• Britain and the European Union remained divided over competition and fishing on Wednesday as they tried to clinch a Brexit trade deal in time to avoid a turbulent split at the end of the year.
• Ireland said a deal was still possible before Britain leaves the EU's orbit on Dec. 31, 11 months after it formally quit the bloc and entered a transition period keeping it in the bloc's customs union and single market until the year ends.
• But with a dizzying array of conflicting signals coming from the two sides, Britain has not yet managed to agree on a deal that would ease the pain of its departure by keeping in place zero-tariff and zero-quota access to the single market.
• Irish Prime Minister Micheál Martin said the gap on how much fish EU boats could catch in British waters was still wide, but that he believed there should be a deal given the economic shock that failure would trigger.

(Source: Reuters)

• U.S policymakers need to consider major changes to make money market funds less vulnerable to investor runs, a working group led by the Treasury Department said on Tuesday, stopping short of making specific recommendations.
• The group laid out several potential changes to those markets, in which the U.S. government intervened to stabilize after big outflows prompted by the coronavirus outbreak in March.
• Ideas included setting stricter rules around fund redemptions, or higher capital buffers for such funds, but the group said it was not favoring any specific approach.
• The report could kick off a broader effort to overhaul money market funds. Former Federal Reserve Chair and incoming Treasury Secretary Janet Yellen are expected to review so-called "shadow banking," which includes such funds.

(Source: Reuters)

• The Economic Programme Oversight Committee met on December 4, 2020, to review the macro-fiscal program of the GOJ for 2020/21FY.
• Based on the reports presented by the Ministry of Finance and the Bank of Jamaica, the GOJ and the BOJ is on track to meet all quantitative targets under the GOJ Economic Reform Programme (ERP) as at the end of September 2020.
• With tax revenues, year to date is 17.6% behind the same period last year and as GDP growth projections are revised downwards, the MOF continues to project that Revenues and Grants for the last quarter of FY2020/21 will be 3.7% higher than the outturn for the corresponding quarter of FY2019/20 and is cautiously optimistic that this target will be achieved.
• The GOJ however remains committed to achieving the downward revised 3.1% primary balance target which could involve a reallocation and reduction of expenditures to achieve the said target

(Source: EPOC)

• An independent evaluation of prospective resources offshore Jamaica prepared by Gaffney Cline & Associates (Gaffney Cline) shows that there is potential for more than 2.4 billion barrels of oil across 11 prospects and leads covering the Walton Morant license. This license is now held 100% by United Oil & Gas, a U.K.-based oil and gas company.
• “United has long held the view that the Walton Morant Basin is a highly prospective and exciting basin, with billion-barrel potential,” said Jonathan Leather, Chief Operating Officer of United Oil and Gas. “This is the second independent report on the license and the first to explore prospects across the full basin.”
• He said results from the report will help the company move towards reaching the goal of being in a position to drill the first exploration well offshore Jamaica for over 40 years.

(Source: Oil Now)