• President-elect Luis Abinader will maintain business-friendly policies in the Dominican Republic as he takes office in the middle of the Covid-19 pandemic.
• Fitch Solutions has revised up its Short-Term Political Risk Index score to 67.0 out of 100, from 65.9 previously, as the transition of power from the Partido de la Liberación Dominicana (PLD) to the Partido Revolucionario Moderno (PRM) supports political stability.
• The new administration’s biggest challenges will be fulfilling campaign pledges to combat corruption and narrow the country’s fiscal deficits.

(Source: Fitch Solutions)

• IBD Invest said Tuesday that it sold $1Bn worth of 3-year bonds to fund a lending program for companies affected by the Covid-19 pandemic, building on a $1Bn issue in April.
• The Washington DC-based multilateral lender, part of the Inter-American Development Bank (IDB), priced the new 0.5% notes at $99.96 to yield 0.51%, equal to 29 basis points over mid-swaps or 33.75 basis over US Treasury bonds.
• The bookrunners- BMO (Bank of Montreal), Citi, Goldman Sachs and TD (Toronto-Dominion) Securities- took more than $1.55Bn in orders from 51 investors, with 38% of buyers from the Americas, 37% from Europe, the Middle East and Africa (EMEA), and 25% from Asia.
• Central banks and official institutions bought 75% of the notes on offer, followed by fund managers with 14%, commercial banks with 7% and insurers and pension plans with 4%, according to IBD Invest.

(Source: Latinfinance)

• Singapore’s economy plunged into recession last quarter as an extended lockdown shuttered businesses and decimated retail spending, a sign of the pain the pandemic is wreaking across export-reliant Asian nations.
• Gross domestic product declined an annualized 41.2% from the previous three months, the Ministry of Trade and Industry said in a statement Tuesday, the biggest quarterly contraction on record and worse than the Bloomberg survey median of a 35.9% drop. Compared with a year earlier, GDP fell 12.6% in the second quarter, versus a survey median of -10.5%.
• A plunge in global trade has hit the export-reliant manufacturing industry, while retailers saw a record decline in sales after partial lockdown measures were imposed last quarter. The government, which has projected a full-year economic contraction of 4%-7%, didn’t provide a new forecast Tuesday.
• The dismal outlook in Singapore is pressuring the ruling People’s Action Party, which had its weakest performance ever in last week’s election. The government has already pledged about S$93Bn ($67Bn) in stimulus to shore up troubled businesses and households and prevent a surge in retrenchments.

(Source: Bloomberg)

• British inflation rose unexpectedly last month, official data showed on Wednesday. Consumer price inflation increased to 0.6% in June from 0.5% in May, the Office for National Statistics said. The average forecast in a Reuters poll of economists was for the rate to fall to 0.4%.
• Core inflation - which excludes typically volatile energy, food, alcohol, and tobacco prices - rose to 1.4% from May’s 1.2%. Economists had expected the rate to remain unchanged at 1.2%.

(Source: Reuters)

• For the year ended March 2020, Wigton Windfarm Limited reported a 34.3% increase in audited net income relative to the corresponding period in 2019. Net Profits rose from $493.59Mn (EPS:4¢) in 2019 to $662.75Mn (EPS: 4¢) in 2020.
• Despite a 56.1% ($282.11) decline in other income, this favorable outturn was largely due to a 49.8% (or $522.88Mn) reduction in finance costs.
• The company’s stock price has fallen 18.6% since the start of the year, closing Monday’s trading session at $0.79. At this price, the stock currently trades at a P/E of 13.2x earnings, which is below the Main Market Industrials and Materials Sector Average of 24.5x.

(Source: WWF Financials)

• Jamaica Broilers Group Limited reported an audited net profit attributable to shareholders of $1.40Bn (EPS: $1.37) for the year ended May 2, 2020. This represents a 40.8% (or 965.49Mn) contraction relative to 2019, despite a 1.3% (or $690.00Mn) increase in revenues.
• This outturn can largely be explained by a 9.8% (or $880.49Mn) increase in administrative expenses, a 19.7% (or 195.217Mn) increase in finance cost, a 37.4% (or $218.71Mn) decline in other income as well as a 90.1% (or $330.36Mn) decrease in finance income. 
• The stock has fallen 36.4% since the start of the calendar year. JBG closed Monday’s trading session at $26.01 and currently trades at a P/E of 19.0x earnings, which is below the Main Market Distribution & Manufacturing Average of 19.4x.

(Source: JBG Financials)

• The COVID-19 pandemic has been inflicting major economic damage in both Curaçao and Sint Maarten. GDP is projected to drop by 23% in Curaçao, and 25% in Sint Maarten, wielding a major impact on the fiscal revenue, social security systems, and balance sheets in all sectors.
• This could put the countries in need of support measures for the rest of the year, which could result in a sizeable increase in debt. Following this, it will be pertinent that the authorities implement measures to put the debt firmly on a downward path as the crisis abates.
• Strong commitment to deep structural reforms that were urgently needed before the pandemic, also becomes critical to a successful post-COVID recovery.

(Source: IMF)

• Creditors holding Ecuador's sovereign debt issued a statement on Friday saying they commended to the government for its approach to restructuring $17.4Bn worth of bonds, but the terms need to be improved and strengthened for the equal treatment of all investors.
• The statement was issued by two groups of investors. The Steering Committee (SC) for more than 25 global institutional investors who hold various sovereign bonds is being advised by BroadSpan Capital and UBS, while the ad hoc group of investors who hold Ecuador 2024 notes is being advised by Quinn Emanuel Urquhart & Sullivan LLP.
• Finance Minister Richard Martinez said in a press conference on July 6^th that, existing debt capital would be reduced to $15.8Bn from $17.4Bn; interest rates would come down to an average of 5.3% from 9.2. Maturities are to be lengthened 12.7 years on average from 6.1 years on average. This will be done by extending the maturity of some bonds to 2040. Currently, the longest maturity is 2030.
• A grace period was achieved both for capital and interest payments so for the next five years, Ecuador will not make any capital payments.

(Source: Latinfinance)

• Fitch Solutions has reduced its global growth forecast slightly since its June publication, and now anticipates a contraction of 3.9% for the global economy (from 3.6% previously). This change is largely on the back of revisions to economic growth in countries such as Belgium (-8.0%), the UK (-7.7%), South Africa (-7.0%), Thailand (-5.4%), Poland (-4.1%) and Australia (-3.3%).
• However, the agency does note several risks to this view. Firstly, the return to normality looks quite difficult given the second waves of infections. While they may not result in blanket lockdowns, the authorities in China and the US have imposed multiple localized lockdowns, while Australia has closed its internal borders to stop the spread of the infection. This suggests that the return to normality might prove to be quite challenging, which could sap momentum from the nascent recovery.
• Secondly, another wave of infections and a weak pace of recovery could result in a second wave of layoffs by businesses, since profitability would remain under pressure. This in turn could keep unemployment elevated for a sustained period, which would be negative for private consumption and headline growth.

(Source: Fitch Solutions)

• Britain’s economy could shrink by more than 14% this year if there is lasting damage from the coronavirus, a scenario that would push government borrowing to nearly half a trillion dollars, budget forecasters said on Tuesday.
• The base scenario, with only moderate long-term damage, showed a 12.4% fall in output, with a 14.3% decline if the scarring is deeper. In the downside scenario, borrowing in the current financial year could hit £391Bn ($490Bn), and in the upside scenario- £263Bn, with output falling 10.6%.

(Source: Reuters)