• The Federal Reserve cut interest rates by a quarter-point and signaled that policy is just about where officials want it to be, so there may not be any further reductions on the way.
• That's prompted traders to trim their bets on any imminent further easing, all of which is unlikely to offer any salve to Fed critic President Donald Trump, who on Tuesday said the Fed “doesn’t have a clue!”
• The decision complicates the outlook for many Asian central banks and eyes will turn once again to the European Central Bank and its new leader, Christine Lagarde, as skepticism grows about negative rates.

(Source: Bloomberg)

• Argentine corporates may adopt a wait-and-see approach with business strategies over the near term, even after President-elect Alberto Fernandez's widely-anticipated victory on Sunday.
• Electric utilities may be most vulnerable, given an increased possibility of Argentine pesification (paying back liabilities in pesos rather than dollars) of contract rates, but all Argentine issuers are subject to risks stemming from the country's economic crisis, monetary policy changes and uncertain regulation.
• Political uncertainty remains high due to the tight fiscal constraints the incoming government will inherit, lack of clarity on its policy orientation, and what this could mean for existing regulatory policies. Additionally, Argentine peso volatility can further stress issuers' ability to service debt.

(Source: Fitch Solutions)

• Fitch affirmed Costa Rica’s B+ rating with a negative outlook on “weaknesses in public finances and political gridlock that has prevented the timely passage of reforms addressing these”.
• Government’s fiscal deficit to widen to 6.3% of GDP this year and remain above 5% of GDP until 2023: debt-to-GDP will climb to 71% by 2023
• Fitch estimates sovereign financing needs of 10.3% of GDP and 13% of GDP 2021 and 2022. Economic growth to slow to 2% in 2019 and stay below 3% in 2020-21 on costs of new VAT tax and weak consumer confidence. They also see risks around compliance with new fiscal rules. Expenditure reduction required under the fiscal rule is currently facing political and social resistance.

(Source: Bloomberg)

• Social Protection Analyst at the Planning Institute of Jamaica (PIOJ), Camille Graham, has underscored the need for continuous dialogue on the implications of the aging population and how to capitalize on opportunities that this group offers to the economy and society.
• Graham said that citizens and stakeholders “must be mindful of the social, economic and environmental implications of the aging population in Jamaica, what this phenomenon means for all of us and how we can make it work in the best interest of all”.
• She was addressing a recent ‘Dialogue for Development Series’ public consultation at the Golf View Hotel in Mandeville, themed ‘Ageing and Development: Exploding Myths, Exploring Opportunities’.

(Source: JIS)

• Lasco Manufacturing’s profit increased by 11.8% for the six-month period ended September 30, 2019. Net profit YTD moved up from $503.06Mn (EPS: $0.12) to $562.56Mn (EPS: $0.14).
• The net profit improvement came on the back of lower finance costs (down 15.3% or $9.7Mn) as well as a 1.3% ($50.30Mn) increase in sales coupled with a 2.0% ($48.30Mn) fall in cost of goods sold.
• The stock has risen 36.2% YTD and closed yesterday’s trading session at $5.03. At this price, the stock currently trades at a P/E of 17.80x which is below the Junior Market Manufacturing sector average of 24.50x.

(Source: LASM Financials)

• A resilient American consumer helped the U.S. economy expand more than forecast in the third quarter, assuaging concerns for now of a more pervasive slowdown tied to weakening business investment and faltering export markets.
• Gross domestic product expanded at a 1.9% annualized rate, according to Commerce Department dataWednesday that topped forecasts in a Bloomberg survey that called for 1.6% growth. That’s down from 2% in the second quarter.
• The gain mainly reflected strength in consumer spending, the biggest part of the economy, which increased at a 2.9% rate and exceeded projections for a 2.6% rise.
• For businesses, non-residential fixed investment fell the most since late 2015.

(Source: Bloomberg)

• Home-price gains in 20 U.S. cities decelerated in July for a 16th straight month, as values proved still too elevated for buyers despite low mortgage rates.
• The S&P CoreLogic Case-Shiller index of property values increased 2% from a year earlier, the slowest since August 2012, according to data released Tuesday. Nationally, home-price gains remained steady, rising at a 3.2% pace.

• The latest data highlight how the market continues to struggle despite solid wage gains for Americans and cheaper borrowing costs. A shortage of affordable inventory and construction constraints have helped lift home prices despite demand that has been somewhat tepid as elevated prices deter some potential buyers.
• Price gains may accelerate in coming months amid signs that lower rates may be luring more buyers into the market. Existing home sales rose in August to the best pace in more than a year, while the median sales price saw the second-fastest gain in the past year.

 (Source: Bloomberg)

• Home-price gains in 20 U.S. cities decelerated in July for a 16th straight month, as values proved still too elevated for buyers despite low mortgage rates.
• The S&P CoreLogic Case-Shiller index of property values increased 2% from a year earlier, the slowest since August 2012, according to data released Tuesday. Nationally, home-price gains remained steady, rising at a 3.2% pace.

• The latest data highlight how the market continues to struggle despite solid wage gains for Americans and cheaper borrowing costs. A shortage of affordable inventory and construction constraints have helped lift home prices despite demand that has been somewhat tepid as elevated prices deter some potential buyers.
• Price gains may accelerate in coming months amid signs that lower rates may be luring more buyers into the market. Existing home sales rose in August to the best pace in more than a year, while the median sales price saw the second-fastest gain in the past year.

 (Source: Bloomberg)

• The pressure is mounting on the Federal Reserve to take more aggressive steps to address stress in U.S. funding markets as swap spreads tumbled to record lows Thursday. 
• The New York Fed is planning a fourth temporary liquidity injection Friday, and the moves have helped to allay concern after repo rates soared to 10% Tuesday.
• Still, the dollar-funding squeeze could get worse with the end of the quarter approaching, raising the possibility that liquidity-providing banks will retreat to close their books and meet capital needs.
• Meanwhile, another round of Treasury auctions next week could leave markets short an additional $45Bn in cash.
• Over in China, analysts called for stronger easing signals after the People’s Bank of China only slightly lowered the one-year reference rate for bank loans, a new gauge of borrowing costs

(Source: Bloomberg)

• The tourism industry continues to record unprecedented growth, with a 9.1% increase in stopover arrivals for the first eight months of 2019.
• Director of Tourism, Donovan White, points out that up to August 31, 2019, Jamaica recorded 1.8Mn in stopover arrivals, achieving a revenue inflow of US$2.39Bn, which is a 12.0% growth in earnings over the same period last year.
• White was speaking at the 2019 Jamaica Product Exchange (JAPEX) Media Breakfast at the Half Moon Hotel, Rose Hall, Montego Bay, St. James, on Tuesday, September 10.
• According to the Director, Jamaica is poised to generate approximately US$3.5Bn in tourism earnings from stopover arrivals for 2019, a 12.0% increase in revenue inflow over 2018.
• He added that just under 2.7Mn stopover tourists are expected to visit the island by the end of 2019, an increase of 8.5%.

(Source: JIS)