• Growth has remained strong, reflecting external tailwinds and the fruits of past reforms. The outlook is promising but is subject to downside risks.
• The focus of policy should shift toward making growth more sustainable, resilient, and inclusive. Fiscal policy should balance further progress in debt reduction against a gradual use of well-earned fiscal space to close the country’s infrastructure and resilience gaps, in tandem with capacity and efficiency improvements to bolster the impact on growth.
• Policies to enhance resilience to climate change and natural disasters should be fully integrated into a credible medium-term fiscal framework.
• Continued progress in financial sector oversight, structural reforms, economic governance, and data provision is necessary to support and enhance sustainable growth.

(Source: IMF)

• The Deputy Prime Minister of Bahamas has signaled that the government remains on track to hit its main 2018-2019 fiscal target by touting a $400Mn reduction in the annual deficit since it took office.
• Addressing the UHY accounting firm’s Americas conference on Friday, K Peter Turnquest, disclosed figures ahead of this week’s 2019-2020 budget that hints the Minnis administration will bring the fiscal deficit within range of its $237Mn target for the current fiscal year.
• Giving an upbeat assessment of The Bahamas’ economic prospects, Mr. Turnquest focused on the 1.6% real GDP growth achieved in 2018 as a sign that the Government’s economic and fiscal policies are starting to bear fruit.

(Source: Tribune 242)

• Treasuries are in the vanguard of a bull run in global bonds, bringing into sight the prospect of benchmark 10-year yields dropping to 2% for the first time since late 2016 as traders ramp up bets on monetary-policy easing by the U.S. central bank.
• Escalating U.S.-China trade tensions and faltering global growth have seen U.S. 10-year yields tumble almost 40 basis points since mid-April to as low as 2.22% on Wednesday, May 29.
• The gap between the three-month and 10-year American yield fell as low as minus 12 basis points, the most since negative 2007, while fed funds futures showed about three quarter-point central bank cuts priced in by the end of next year.

(Source: Bloomberg)

• The disastrous showing for both the Conservatives and Labour party in the European elections has raised the likelihood of more extreme Brexit outcomes.
• The choice for lawmakers, and possibly the electorate, maybe between no deal or no Brexit.
• For the economy, the difference between those two outcomes is about 7% of GDP by 2030, according to Bloomberg Economics’ estimates.

(Source: Bloomberg)

• The Bank of Jamaica (BOJ) says prospects for the Jamaican economy remain positive, as economic growth continues to be underpinned by rising employment.
• BOJ further noted that credit extended to private-sector businesses and households by commercial banks, merchant banks, and building societies has increased by 15.2% (+1.4%) over the 12-month period ending March 2019.
• He also added that foreign reserves are adequate and that Jamaica has a sustainable position in the current account of the balance of payments. “Fiscal performance is strong and Jamaica is shedding its burdensome debt load at an admirable rate. Inflation is low, stable and predictable,” said Governor Wynter.
• This positive outlook was given by Governor, Brian Wynter, at the Bank’s quarterly press conference.

(Source: JIS)

• The group achieved a 109% upturn in profits for the first quarter ended March 31, 2019. Net profits moved from $492.63Mn (EPS: $0.22) to $1.03Bn (EPS: $0.31) mainly as a result of efficiency measures undertaken by the company.
• The company experienced a 44.5% dip in expenses, moving from $2.8Bn in 2018 to $1.5Bn in 2019 which contributed substantially to the improvement in the bottom line. There was a decline in all expenses incurred for the period, but the biggest reductions were seen in ‘interest and other financing costs’ which fell by 158%, and ‘hotel expenses from continuing operations’ which dropped by 43%.
• The stock’s price has fallen 29.42% since the start of the calendar year. Sagicor Real Estate X Fund closed trading yesterday at $9.93 and currently trades at a P/E of 62.06x earnings which is above the Main Market Real Estate sector average of 23.83x.

 (Source: Sagicor X Fund Financials)

• Fitch Solutions expect Trinidad &Tobago’s (T&T) fiscal consolidation to continue over the coming quarters, albeit at a reduced pace.
• It is forecasted that T&T’s fiscal deficit will continue to narrow over the coming quarters, shrinking the deficit from 3.9% of GDP in 2018 to 2.8% in 2019 and 2.0% in 2020.
• Revenues will be supported by rebounding economic activity, while expenditure growth will remain relatively subdued.
• However, the ongoing crisis in Venezuela threatens important revenue streams which could negatively impact T&T’s fiscal consolidation.

(Source: Fitch Solutions)

• Trinidad Petroleum Holdings Ltd (TPHL) on Friday announced that the expiration date for the Petrotrin bond exchange program has been extended until June 14 at 5 p.m., New York City time (4 p.m., local time), which is the third time the expiration date has been pushed back.
• TPHL is the parent company of Petrotrin, which remains as a registered company but whose operations were made defunct by the Government.
• TPHL is looking to exchange a US$850 million bond that becomes due in August this year for bonds that mature in 2026.
• Up to last Friday, holders of the Petrotrin bonds had consented to exchange some US$152Mn of Petrotrin's bonds, which include some amortizing bonds that mature in 2022.

(Source: Trinidad Express Newspaper)

• The race to be next leader of the U.K. Conservative Party is widening as more candidates throw their hats into the ring.
• The party’s dismal performance in the European elections may force the next leader to take a harder stance on Brexit, while opposition Labour Party leader Jeremy Corbyn was forced to promise a referendum after Labour also lost seats.
• In the rest of the European Union, horse trading has begun in earnest over the division of the top jobs following the election, with leaders meeting this evening to discuss the next European Commission and European Central Bank president.

(Source: Bloomberg

• Canadian Prime Minister Justin Trudeau’s government gave lawmakers formal notice it intends to bring forward legislation to ratify the new North American free trade agreement.
• Foreign Affairs Chrystia Freeland introduced a “ways and means” motion in the House of Commons on Monday for the legislation, which is the first step in the process for parliamentary approval.
• The procedure comes ahead of a visit to Ottawa by U.S. Vice President Mike Pence, who is scheduled to meet with Trudeau on Thursday to discuss advancing the agreement.
• A decision by President Donald Trump’s administration last week to lift tariffs on steel and aluminum helped clear major hurdles for lawmakers in all three countries to approve the U.S.-Mexico-Canada Agreement.

(Source: Bloomberg)