Online Banking

Latest News

Euro Zone Ministers Pledge To Extend Fiscal Support Through 2022 Published: 16 March 2021

  • Eurozone finance ministers promised on Monday to extend public support for the economy through 2021 and 2022 to help the common currency area emerge from the coronavirus crisis, saying they would deal with rising debt only once recovery is on track.
  • The ministers, known as the Eurogroup, also said the public support, so far worth 8% of eurozone gross domestic product in national fiscal measures and 19% of GDP in liquidity measures, or more than 3 trillion euros ($3.58 trillion) in total, would be maintained as long as there is an acute health crisis.
  • "The Eurogroup is committed to a supportive stance in the euro area in 2021 and in 2022, also taking into account the fiscal stimulus stemming from the RRF (Recovery and Resilience Facility)," the ministers said in a statement, as had been reported by Reuters on Friday.
  • The RRF totals 672.5 billion euros in loans and grants, to be borrowed jointly by the EU, on top of the national fiscal and liquidity measures so that EU countries hard hit by the pandemic and with already high debt can finance reforms and investments to make economies greener and more digitalized.

(Source: Reuters)

NHT Plans to Invest $57.7Bn on Housing Solutions Published: 04 March 2021

  • The National Housing Trust (NHT) plans to invest $57.7Bn to facilitate the commencement of 8,513 housing solutions and the completion of 7,043 units by March 31, 2022.
  • The NHT’s plans include the commencement of construction on units in Albion, St. Thomas and Point, Hanover under the Guaranteed Purchase Programme, as well as solutions at Mount Nelson, Manchester; Fontabelle, Westmoreland; and Rasta City, Kingston.
  • The planned level of capital expenditure includes the disbursement of 12,083 mortgage loans under different programs, including build on own land, open market, construction, joint mortgage finance, and house lot loans.
  • Meanwhile, the NHT will continue to provide special subsidies and grants amounting to $1.6Bn. This allocation will include provision for community renewal projects and mortgage subsidies aimed at increasing access to benefits by contributors in the lower-income bands.
  • This project will help to improve the standard of living for many citizens in the future. In the short-term, it should also support economic recovery in the construction sector which declined by an estimated 0.8% in 2020.

(Source: JIS & NCBCM Research)

MPC Caribbean Clean Energy Limited (MPCCEL) – Acquisition of an Asset Published: 04 March 2021

  • MPC Caribbean Clean Energy Limited (MPCCEL) has advised that on 22nd December 2020, MPC Caribbean Clean Energy Fund LLC, the Investment Company of MPC Caribbean Clean Energy Limited, signed the acquisition of a 6.4 MWp solar park San Isidro, in El Salvador.
  • The solar park started its commercial operation on January 29, 2021, and on March 2, 2021, the transaction has been successfully completed.
  • MPCCEL further stated that the San Isidro solar park will help to avoid an estimated 36,000 tons of CO2 emissions throughout its lifetime.
  • This acquisition should help MPCCEL to increase its energy generation to satisfy greater energy demands and attract more revenues to support future top-and-bottom-line growth.

(Source: JSE & NCBCM Research)

Dominican Government Will Push For Fiscal Consolidation In Coming Years Amid Wider Deficits Published: 04 March 2021

  • Prior to the pandemic, Dom Rep’s fiscal deficit stood at 2.3% of GDP before rising to an estimate of 7.3% in 2020. Fitch forecast that with the help of rebounding revenues, the country’s fiscal deficit will narrow to 6.1% of GDP in 2021 and 5.4% in 2022, with public debt climbing to 54.9% of GDP in 2021 and 57.4% 2022, from an estimated 52.7% in 2020. 
  • Real GDP is forecasted to grow by 5.0% y-o-y in the Dominican Republic in 2021 and 4.7% in 2022, up from an estimated -6.8% in 2020, as private consumption and tourism recover from the economic shock of the COVID-19 pandemic.
  • Additionally, the ongoing government stimulus measures, combined with the planned roll-out of a COVID-19 vaccine in March 2021, will help economic activity return to normal over the coming quarters. This estimated recovery is significant when compared to the forecast 3.4% GDP growth for the Caribbean in 2021, and 3.6% in 2022.
  • The prospects for improvement in both fiscal and economic performance along with the push for fiscal consolidation continue to support our current HOLD recommendation on the sovereign.

(Source: Fitch solutions & NCBCM Research)

Brazil GDP Drops 4.1% In 2020, COVID-19 Surge Erodes Rebound Published: 04 March 2021

  • According to statistics agency IBGE, Brazil’s economy shrank by 4.1% last year due to the coronavirus pandemic, its worst drop in decades. The country is experiencing a devastating second wave of COVID-19 that threatens to cut short a stronger-than-expected rebound in the economy at the end of 2020.
  • Latin America’s largest economy grew by 3.2% in the fourth quarter, more than the 2.8% median estimate in a Reuters poll of economists.
  • However, that recovery, based on consumption by households receiving emergency government cash transfers, may be eroded by a resurgent outbreak now killing record numbers of Brazilians and adding to fears of another downturn early this year.
  • The full-year 2020 drop was the worst since the current IBGE series began in 1996. The 2020 plunge was also the worst since a 4.35% fall in GDP recorded in 1990, according to central bank data going back to 1962, and the third-steepest in that series.

(Source: Reuters)

UK Economy To Regain Pre-Pandemic Size Earlier Than Forecast Published: 04 March 2021

  • Britain's economy will regain its pre-pandemic size in the middle of 2022, six months earlier than previously forecasted, finance minister Rishi Sunak said on Wednesday, while announcing an extension of emergency aid to get it through its lockdown.
  • The economy will remain 3% smaller in five years' time than it would have been without the damage wrought by the coronavirus crisis and extra support is needed now as the country remains under coronavirus restrictions, he said.
  • Among the new support measures was a five-month extension of his huge jobs rescue plan and more help for the self-employed, the continuation of an emergency increase in welfare payments, and an extension of a VAT cut for the hospitality sector.
  • Announcing forecasts by the Office for Budgetary Responsibility (OBR), Sunak said the economy was likely to grow by 4% in 2021, slower than a forecast of 5.5% made in November.
  • Looking further ahead, the OBR forecast gross domestic product would grow 7.3%, 1.7%, and 1.6% in 2022, 2023, and 2024 respectively. In November, the OBR had forecast growth in those years of 6.6%, 2.3%, and 1.7%.

(Source: Reuters)


Dovish BOJ Policymaker Calls For New Strategy To Beat Price Stagnation Published: 04 March 2021

  • The Bank of Japan must lay out a new strategy for hitting its elusive 2% inflation target at this month's policy review, board member Goushi Kataoka said, warning the drag to growth from the COVID-19 pandemic could prolong price stagnation.
  • Kataoka said the pandemic's hit to demand will likely delay Japan's economic recovery and weigh on inflation expectations, which have been falling since the end of 2019.
  • "If we see a repeated rise in infections, that would negatively affect both the output gap and inflation expectations. This, in turn, will prolong price stagnation," Kataoka said in a speech to an online meeting with business leaders on Wednesday.
  • The BOJ plans to conduct a review of its policy tools in March to make them more sustainable and flexible to weather what had become a prolonged battle to reflate growth and achieve its price goal. Governor Haruhiko Kuroda has stressed the review will not lead to an overhaul of its stimulus program.
  • Kataoka, seen as the most dovish policymaker in the BOJ's nine-member board, has lobbied unsuccessfully for cutting interest rates and strengthening the BOJ's commitment to take stronger steps to fire up inflation. He repeated his calls for the BOJ to more strongly committed to keeping rates low for a prolonged period.

(Source: Reuters)

Plans Advanced To Develop Central Bank Digital Currency Published: 23 February 2021

  • Bank of Jamaica (BOJ) Governor, Richard Byles, says plans are advanced to develop and implement the use of a Central Bank Digital Currency (CBDC) locally. Speaking during the BOJ’s digital quarterly briefing on Friday, Mr. Byles said that over the last couple of months, the Bank undertook the requisite preliminary work relating to assessments and protocols for approval of the proposed digital currency through the government process.
  • “So we are, hopefully, going to Cabinet for approval very shortly and will [thereafter] start a pilot in the second or third quarter of this year,” he informed.
  • Byles advised that the pilot will “run for a couple of months” and “hopefully, conclude by about the end of this year”. Thereafter, he added, “we will be able to… publicly launch the digital currency in early 2022”.
  • CBDC is a form of Central Bank-backed currency and is, therefore, legal tender. It is a fiat currency, which means it can be exchanged, dollar for dollar, with actual cash, and is issued to licensed deposit-taking institutions on a wholesale basis. Individuals, households and businesses can use it to pay for goods and services, as obtains with cash.

(Source: JIS News)

Vaccine Vital to Latin America Economic Recovery Published: 23 February 2021

  • Widespread vaccination is the key to overcoming the COVID-19 pandemic and bolstering economic recovery in Latin America, says Fitch Ratings in a special report. Some countries have re-imposed mobility restrictions, albeit more localized and less severe than during the initial outbreak, following the second wave of coronavirus cases and deaths in the region.
  • The virus resurgence will adversely affect economic activity in Q1 2021, and the scope and pace of the recovery in H2 2021 will depend on the speed and effectiveness of vaccine rollouts. Social distancing measures are likely to be eased but not fully removed until H2 2021 or even 2022.
  • Vaccination has begun slowly in much of the region, and limited vaccine supply and weak distribution networks pose challenges. Mexico, Peru, and Chile appear best placed in terms of vaccine agreement coverage as a share of their populations.
  • A key risk for economic recovery is the prevalence of new variants that may be more contagious, have higher mortality, or be more resistant to the existing vaccines. Slower-than-expected distribution or production bottlenecks (some evidence of this exists in the EU) would further slow the vaccine rollout and delay the recovery.

(Source: Fitch Ratings)

Peruvian Growth Will Outpace Other Latin American Markets As COVID-19 Impact Subsides Published: 23 February 2021

  • Following a historic contraction in 2020, the Peruvian economy will be one of the fastest-growing markets in Latin America in the coming quarters as rebounding private consumption and a surge in investment drive a recovery. 
  • While Fitch Solutions is also upbeat on Peru's longer-term growth outlook, it highlights downside risks from the country's COVID-19 vaccine rollout and the April 2021 general election, particularly if the next government vows to re-evaluate the longstanding market-friendly status quo. 
  • Fitch Solutions has revised its real GDP growth forecasts to 7.2% y-o-y in 2021 and 4.3% in 2022, from 6.3% and 4.2% previously. In 2020, the economy contracted 11.1%

(Source: Fitch Solutions)