Strong remittance-fueled private consumption and muscular investment growth will drive real GDP growth in Guatemala over the coming quarters.
However, heightened political risks, including popular resistance to Guatemala’s asylum agreement with the US and a violent backlash to President Alejandro Giammattei’s anti-crime crackdown, pose downside risks to economic activity.
Fitch has revised up its real GDP growth forecast for 2020 from 3.3% y-o-y to 3.8%, due to the strong trend in remittance inflows and investment activity in recent months. This compares to estimate of 3.7% growth in 2019.
The expectation is that Ecuador’s current account deficit will expand to 1.6% and 1.8% of GDP in 2020 and 2021, as a rebound in private consumption drives import growth.
Net investment outflows will continue to put pressure on Ecuador’s foreign reserves.
Ecuador will remain dependent on the IMF to finance its current account and trade deficits, though we expect a renegotiation of the terms of the programme.
President Donald Trump is poised to sign a deal with China on Wednesday that leaves significant tariffs in place and for the first time would punish Beijing if it fails to deliver on pledges related to its currency, intellectual property and the trade balance.
But the question set to dog Trump the moment the ink dries is whether the pact will rewire the relationship between the world’s biggest economies. For many in Washington, U.S.-China economic ties have become an example of the evils of globalization, the tensions of 21st century technology and geopolitics, and the missteps of past presidents.
The “phase one” deal that Trump recently called a “big, beautiful monster” is by no means a standard trade agreement: At 86 pages, it’s thinner than most on substance and commitments. The U.S. agreed to halve 15% duties on $120 billion of imports and delay others in return for Chinese promises to make structural reforms and purchase an additional $200 billion in American goods and services over the next two years. The full text will be released Wednesday.
The U.K. is about to ask how quickly it should fix one of its most controversial pieces of economic data, a measure of prices riddled with problems.
Chancellor of the Exchequer Sajid Javid will start a consultation in March on fixing the retail-prices index. That follows a decision last year to correct the flawed gauge by 2030, or possibly as early as 2025 based on the result of feedback.
The move will be another step in a long-running saga about a flawed statistic that’s used for the 453 billion-pound ($590 billion) inflation-linked gilt market, as well as setting increases for student loans and rail fares. With RPI 80 basis points higher, on average, than consumer-prices index, that means higher costs for rail commuters, while the state has to pay more to holders of linkers.
Preliminary data from the Jamaica Tourist Board (JTB) indicates that cruise passengers accounted for over 1.5Mn of the approximately 4.3Mn tourists visiting the island in 2019.
This was disclosed by Tourism Minister, Hon. Edmund Bartlett, who spoke with JIS News following last Friday’s (January 10) arrival of one of the Norwegian Cruise Line’s (NCL) flagship vessels – the ‘Norwegian Bliss’ – which made its maiden voyage to Jamaica, docking at the Ocho Rios Port.
The Minister headed dignitaries and officials welcoming the ship’s crew and 5,700 passengers, who each received a complimentary cup of the globally renowned Jamaica Blue Mountain Coffee.
Mexico went to the euro-denominated market on Monday for its second bond sale of the year, raising €1.75 billion ($1.95 billion) in a two-part deal that was 3.8 times oversubscribed
The ministry said it sold €1.25 billion in new 2030 notes with a coupon of 1.125%, a record low in euros, and added €500 million to its 2.375% 2039 notes. The 10-year notes priced at 99.468 to yield 1.241%, while the 2039 retap priced at 107.873 to yield 2%.
Mexico opened the initial price talk on the new 10-year bonds at 125 basis points to 130 basis points over mid-swaps and launched at 110 basis points to 115 basis points. It also started the 2039 retap at a yield of 2.15% to 2.2% and launched the deal at 2% to 2.05%.
Fitch Solutions believe the successful implementation of Barbados’ IMF programme will reinforce Prime Minister Mia Mottley’s administration.
Mottley’s popularity, as well as the Barbados Labour Party’s supermajority in the House of Assembly, will allow the Prime Minister to pursue more long-term goals in both environmental and foreign policy.
Nonetheless, fiscal austerity and a sharp increase in Barbados’ violent crime rate pose downside risks to Mottley’s popularity and ability to implement the programme.
Global oil benchmark Brent crude rose 1% to near $65 a barrel on Tuesday, snapping four straight days of declines on easing Mideast tensions as the United States and China, the world’s top energy consumers, prepared to sign a preliminary trade deal.
The outlook for oil demand was supported ahead of the signing at the White House on Wednesday of a Phase 1 U.S.-China trade deal, which marks a major step in ending a dispute that has cut global growth and dented demand for oil.
China has pledged to buy more than $50 billion in energy supplies from the United States over the next two years, according to a source briefed on a trade deal.
The U.S.-Chinese trade war had a tangible impact on global oil demand growth last year, which reached 890,000 barrels per day compared with initial forecasts of 1.5 million bpd, Tamas Varga, an analyst at PVM brokerage said in a note.
U.S consumer prices rose slightly in December and monthly underlying inflation pressures retreated, which could allow the Federal Reserve to keep interest rates unchanged at least through this year.
The Labor Department said on Tuesday its consumer price index increased 0.2% last month after climbing 0.3% in November. The monthly increase in the CPI has been slowing since jumping 0.4% in October. In the 12 months through December, the CPI rose 2.3% after gaining 2.1% in the 12 months through November.
Excluding the volatile food and energy components, the CPI edged up 0.1% after gaining 0.2% in November. The so-called core CPI was up by an unrounded 0.1133% last month compared to 0.2298% in November.
Underlying inflation in December was held back by declines in the costs of used cars and trucks, airline tickets and household furnishing and operations, which offset increases in the prices of healthcare, apparel, new motor vehicles, recreation, and motor vehicle insurance.
Tourism Minister, Hon. Edmund Bartlett, says complimentary coffee tasting for visitors arriving at Jamaica’s cruise ship ports will commence on Friday (January 10), when the Norwegian Bliss docks in Ocho Rios, St. Ann.
“So visitors can look forward to coming to Jamaica, at whatever time we designate it [the festival] in the year. We can package it, pre-sell and tie the festival with hotel rooms and air seats, and create a product that can be marketed throughout the world,” he added.
Globally, coffee is the second largest commodity traded, with exports, mainly from developing countries, totalling US$20 billion annually, and a net worth of US$100 billion.
