• San Francisco Federal Reserve President Mary Daly on Monday said "the time is upon us" to cut interest rates, likely starting with a quarter-percentage point reduction in borrowing costs. Asked if there is anything that could derail a rate cut at the U.S. central bank's Sept. 17-18 policy meeting, Daly told Bloomberg TV that it "would be hard to imagine at this point."
• She said the "most likely" path ahead is for inflation to continue to slow gradually and for the labor market to add jobs at a "steady, sustainable" pace - and if that projection plays out, "adjusting policy at the regular, normal cadence seems reasonable."
• "We haven't seen any deterioration yet in the labor market," she said, but "if we should see deterioration or any signs of weakness, then being more aggressive to ensure that we don't see that would be appropriate." Using words that echoed those of Fed Chair Jerome Powell at a conference last week in Jackson Hole, Wyoming, she said, "the direction of change is down. And the time to adjust is now in my opinion."
• Last week, Powell told the Jackson Hole global central bankers' meeting that "the time has come" to start cutting interest rates, given the progress made in bringing down inflation and the extent of cooling in the labor market.
• By the Fed's preferred gauge, the year-over-year increase in the personal consumption expenditures price index, inflation rose 2.5% in July; the Fed's target is 2%. In 2022 it had peaked at around 7%. The U.S. unemployment rate in July was 4.3%, nearly a full percentage point higher than it was a year ago, but still low by historical standards.
• "We don't want to get ourselves into a situation where we're keeping policy highly restrictive into a slowing economy," Daly said. "Remember, every time inflation comes down, the policy gets more restrictive. And I think that's a recipe, if you will, for overtightening and injuring the labor market and growth."

(Source: Reuters)

• Growing signs of lackluster growth and risks emerging in the job market overshadowed a gathering of global policymakers at the U.S. Federal Reserve's annual Jackson Hole conference, highlighting the changing trajectory of monetary policy as U.S. and European central banks eye cutting interest rates.
• Even as the focus of U.S. and European central bankers shifts from high inflation to softening job markets, the Bank of Japan reaffirmed its resolve to wean its economy off decades of monetary support amid growing signs of sustained price growth.
• The divergence in policy direction, coupled with lingering weakness in China, the world's second-largest economy, points to turbulent times for the global economy and financial markets. The policymakers who met at the annual economic symposium already had a taste of what may come when weak U.S. jobs data earlier this month stoked recession fears and triggered a market rout aggravated by the BOJ's surprise rate hike in July.
• So far, many analysts agree with the International Monetary Fund's projection that the global economy will achieve modest growth in coming years as the U.S. achieves a soft landing, Europe's growth picks up and China emerges from the doldrums.
• However, such rosy projections rest on shaky ground, with doubts emerging over prospects for a U.S. soft landing, euro-zone growth failing to revive, and China suffering from sluggish consumption.

(Source: Reuters)

• The Jamaica-based Global Tourism Resilience and Crisis Management Centre (GTRCMC) and Brazil’s Ministry of Tourism have signed a groundbreaking Memorandum of Understanding (MOU) to facilitate cooperation in boosting tourism resilience.
• The MOU encompasses areas of cooperation such as climate resilience in tourism, entrepreneurial tourism resilience, tourism security resilience, and tourism pandemic resilience. The Honorable Edmund Bartlett, Minister of Tourism, announced that the collaboration will lead to the creation of a GTRCMC satellite centre at the University of San Luis. This partnership, which was formalised at a ceremony in São Luís, Brazil, aims to provide stakeholders with the necessary tools to face upcoming challenges and foster a more resilient tourism sector.
• Minister Bartlett, who signed the MOU alongside his Brazilian counterpart, Hon. Celso Sabino, and Governor of Maranhão, Carlos Brandão, emphasised the importance of this collaboration. It was noted that the establishment of the GTRCMC satellite centre at the University of San Luis will occur in September 2024, coinciding with the G20 Tourism Ministers’ meeting, where Minister Bartlett is expected to present on tourism resilience and sustainability.
• Additionally, Jamaica is poised to become the most connected English-speaking Caribbean destination to Brazil and by extension South America, following high-level discussions led by Minister Bartlett, and his Brazilian counterpart, Minister Sabino.
• Minister Bartlett also noted that the Brazilian government expressed its willingness to incentivise airlines operating this route, a significant step towards enhancing connectivity and facilitating travel between the two countries. “This will undoubtedly deepen our social and cultural ties to South America, opening the door to new economic opportunities for all countries in the region. Our meetings with Brazilian stakeholders underscore our commitment to fostering sustainable growth and expanding Jamaica’s reach in Latin America,” Minister Bartlett added.
• Minister Bartlett further explained that the collaboration is expected to significantly increase the number of Brazilian visitors to Jamaica, contributing to the country’s economic growth and development.

(Source: JIS)

• Brazil will tighten up rules to enter the country without a visa starting next week, the government said, after migrants have been increasingly using the South American nation as a stop-over on the way to the United States and Canada.
• Starting on Monday, August 26, foreign travellers without a Brazilian visa who are headed for another country must travel on to their destination or return to their home country, Brazil's public security ministry told Reuters in a statement.
• Brazil has seen a boom in foreign travellers, particularly from Asia, landing in the country for a supposed layover only to then apply for refuge while they are there, the ministry said. Now, those passengers without a visa will not be allowed to stay in Brazil.
• Investigations revealed that those migrants are requesting to stay in Brazil, alleging persecution and threats in their home countries. Once they are granted refuge in Brazil, many often travel north by land, mainly heading to the United States or Canada through the dangerous Darien Gap, which connects Colombia and Panama, the ministry said, citing police investigations.
• From the beginning of 2023 to the end of June this year, more than 8,300 requests for refuge were presented at Brazil's busiest international airport, according to the ministry. Of those requests, only 117 stayed active in Brazil's national migration system.
• "That means that 99.59% of the people who requested refuge at the airport, 8,210 have either left the country or stayed irregularly," one of the reports stated. More than 70% of the applicants during that period were from India, Vietnam and Nepal, according to the reports, which National Justice Secretary Jean Uema told Reuters bucks historic trends.

(Source: Reuters)

• In the Bahamas, a debate between the ruling Progressive Liberal Party (PLP) and the opposition Free National Movement (FNM) parties has started as a result of different proposals to regulate banks in the country. Banking regulation became a hot topic of political debate after different social groups complained about excessive charges levied by banks to customers.
• FNM leader Michael Pintard seized the moment to say that if his party wins the next election, it will implement sweeping reforms to the banking industry geared towards “making it more cost-efficient … and truly serving Bahamians”. He added that while the FNM will not propose any measure that undermines the viability of the sector, it is concerned about unchecked fee increases that are not related to better service or improved access to financial services.
• The FNM proposes to strengthen the regulatory mandate of the Central Bank to validate fees and streamline banking protocols. The goal would be to lower costs and make the system more inclusive and competitive, with the entry of qualified Bahamians seeking commercial banking licenses.
• Pintard also said that banks should expand their presence in the Family Islands, which are currently underserved. However, some members of PM Philip Davis’ administration have expressed similar concerns, especially Foreign Affairs Minister Fred Mitchell who suggested more government regulation.
• Bahamas Clearing Banks Association (and Fidelity Bank chairman) Gowon Bowe reacted by saying that regulating bank fees “is a slippery slope … the country would be moving towards communism”. He suggested that any serious banking reform proposal should require a prior empirical analysis to assess the impact of the changes. Last year, Central Bank Governor John Rolle said that capping fees would create problems if the structural problems of the banking system were not tackled first.

(Source: Oppenheimer)

• U.S. business activity fell to a 4-month low in August and firms continued to struggle to pass on higher prices to consumers, bolstering the likelihood that inflation will stay on a downward trend over the coming months.
• S&P Global said on Thursday that its flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, edged down to 54.1 this month, following a final reading of 54.3 in July. This level is still healthy and is among the highest measured over the past two years. A reading above 50 indicates expansion in the private sector.
• A slight pick-up in the services sector was outpaced by an easing in the manufacturing industry. Average prices charged for goods and services rose at the slowest rate since January and are now at levels that S&P Global viewed as consistent with the Federal Reserve's 2% inflation target.
• Inflation in July on an annual basis slowed to below 3% for the first time in nearly 3-1/2 years, the Labour Department reported last week. The nearly unchanged composite PMI implied that economic activity remained on a solid footing as the third quarter progressed. Gross domestic product increased at a 2.8% annualized rate in the second quarter, picking up from the January-March quarter's 1.4% pace.
• The S&P Global survey's measure of new orders received by private businesses edged up to 52.3 from 52.2 in July. Its measure of prices paid by businesses for inputs was unchanged at 58.0, but the survey's gauge of prices charged slipped to 52.8 from 53.1 in July. Private sector employment fell, with a decline in the service sector, accompanied by the manufacturing sector, which added the fewest jobs since January.
• The survey's flash manufacturing PMI, an early estimate of manufacturing PMI, retreated to an 8-month low, falling to 48.0 this month from 49.6 in July. Economists polled by Reuters had forecast the index for the sector, which accounts for 10.3% of the economy, to remain unchanged.
• Its flash services PMI, rose to 55.2, from 55.0 in July, confounding economists' expectations for a drop to a reading of 54.0. S&P Global said sentiment about the future continued to be adversely impacted by uncertainty regarding the November presidential election and concerns about future demand, particularly in the manufacturing sector.

(Source: Reuters)

• European Central Bank policymakers saw no urgency in cutting interest rates last month but hinted at a fresh discussion in September as high rates take a toll on growth, the accounts of their July 17-18 meeting showed on Thursday.
• The ECB left rates unchanged at that meeting and gave almost no hint about its future policy moves but the accounts reveal concerns about restricting economic growth too much and show increasing comfort that bringing euro zone inflation down to the 2% target was on track. The ECB was among the first major central banks to cut rates in June and Eurozone economic data in the past six weeks have largely supported the case for further easing.
• Growth in negotiated wages, a key metric to gauge future price pressures, slowed sharply in the second quarter, while economic growth has been anaemic with Germany, the bloc's biggest economy, skirting a recession. That is why markets now see a more than 90% chance of a 25-basis-point rate cut next month, followed by at least another step this year, possibly in December.
• "While there could still be upside surprises to wage growth later in the year, today’s wage growth reading makes a September cut by 25bp even more likely," ING economist Bert Colijn said. The ECB has long been concerned about rapid wage growth but the accounts suggest that policymakers are becoming more relaxed.
• "It was comforting to see that domestic cost pressures from high wage growth, including in the services sector, had been increasingly buffered by unit profits," the accounts showed. Policymakers also thought that inflation was well on its way back to target and inflation was progressing along its long-outlined criteria, putting price growth back at 2% by the end of next year.

(Source: Reuters)

• Ground has been broken for the Boundbrook Urban Centre in Port Antonio, Portland, which is set to provide a major economic boost for the coastal town. The facility will sit on 6.68 acres of land at a total development cost of $4.2Bn and is expected to generate thousands of jobs for parish residents.
• It is being spearheaded by the Factories Corporation of Jamaica (FCJ) with equity partners National Commercial Bank (NCB) and Barita and financed by CIBC.
• Similar to the Morant Bay Urban Centre, which is still under construction, the Boundbrook facility will serve as a centre for commerce and entertainment. It will accommodate government offices, educational institutions, financial services and private-sector businesses including fast food and fine dining restaurants, gaming venues, medical centres, business process outsourcing firms, legal practices, beauty salons, and more.
• Prime Minister, the Most Hon. Andrew Holness, who delivered the main address at the ground-breaking on Wednesday (August 14), noted that the project will offer a myriad of benefits to the people and visitors of Portland, thus transforming the parish. He pointed to similar projects in the pipeline for development in Falmouth, Negril, Old Harbour, and Hopewell.
• For his part, FCJ Chairman, Lyttleton Shirley, revealed that take-up for the project now stands at 110%, expressing confidence that it will be a “one-stop shop offering the services of the government and private sector in one location, while adhering to all concerns of our residents.”
• Minister of Science, Energy, Telecommunications and Transport and Member of Parliament for Portland Western, Hon. Daryl Vaz, welcomed the 3,000 jobs projected to be generated from the project. Member of Parliament for Portland Eastern, Ann-Marie Vaz, called on the young people of the parish to ready themselves for the employment opportunities that will come by upskilling and getting certified.
• “Now is the time to upskill [and] the time to get certified, as this development is already providing jobs and will bring hundreds more during construction and afterwards, with new and expanded businesses that will be operating here,” Mrs. Vaz said.

(Source: JIS)

• In a significant move to bolster the nation’s healthcare system, Guyana’s Minister of Health Dr. Frank Anthony, accompanied by Acting Chief Medical Officer Dr. Jeetendra Mohanlall, met with representatives from the College of the North Atlantic (CNA) and their new partner, Team Broken Earth, on Tuesday, August 20.
• The meeting took place at the Ministry’s Brickdam Headquarters and focused on exploring future collaboration opportunities to enhance healthcare services in Guyana. Ms. Elizabeth Vinecent, Associate Vice President of CNA, led the delegation, which also included officials from the Canadian institution.
• CNA has been actively involved in Guyana through its participation in the Skills to Access the Green Economy (SAGE) project, a development initiative under the Canadian High Commission that focuses on educational and workforce development in the country.
• With recent additional funding, CNA has expanded its reach by partnering with Team Broken Earth, a Canadian medical volunteer organisation renowned for providing critical medical care in underserved regions.
• This partnership aims to leverage both organisations’ expertise to address healthcare challenges in Guyana, potentially bringing advanced training and resources to local medical professionals.
• The meeting marks a pivotal step in ongoing efforts to strengthen the healthcare system in Guyana, aligning with broader initiatives to improve access to quality medical services and enhance the overall health and well-being of the population.

(Source: Guyana Chronicle)

• The Dominican Republic (Dom Rep) said it will create a state mining firm to explore and exploit the nation's key mining resources, including rare earth minerals.
• The Dominican presidency said in a statement that the state firm, Empresa Minera Dominicana S.A., or Emidom, will explore, exploit and run economic viability studies on the country's natural resources.
• The firm will be able to negotiate contracts and alliances with international firms and have a nine-member board, led by the minister of the presidency. Emidom is also tasked with managing the Avila mining reserve in southern Pedernales province, which borders Haiti and in 2018, was declared an area to be explored for possible rare earth projects.
• Rare earths are a group of 17 elements, all but one of which appears on the U.S. Geological Survey's list of 50 “critical minerals,” meaning they are economically important. If exploration leads to any discovery for Dom Rep, this could lead to further economic gains for the nation. The Dominican Republic already boasts GDP growth of 2.4% in 2023 and a 5.4% projected growth for 2024 supported by sound economic, fiscal, and financial policies, and favourable external conditions (strong inflows of travel receipts and remittances).
• Rare earths aside, Dom Rep is home to Canadian firm Barrick Gold's Pueblo Viejo, the largest gold mine in Latin America and the Caribbean.

 (Sources: Reuters & NCBCM Research)