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Brazil Records US$ 7.6Bn Trade Surplus In July Published: 09 August 2024

  • Brazil recorded a foreign trade surplus of US$ 7.6Bn as sales abroad reached an all-time high of US$ 30.9Bn in July, according to data released Tuesday by the Ministry of Development, Industry, Trade, and Services, which represented a 6.6% drop from the US$ 8.2Bn surplus in July 2023, Agencia Brasil reported.
  • Brazilian exports hit a record high of $30.9Bn in July, fueled by strong demand for soybeans, coffee, iron ore, sugar, beef, and steel. On the other hand, imports also went up from July 2023, reaching a total of US$ 23.3Bn. South American exports totaled US$ 198.2 B so far this year, a 2.4% increase compared to the first seven months of 2023. Imports reached US$ 148.6Bn, up 5.6% over the same period.
  • The European Union, China, and the United States stood out as the main destinations for Brazilian exports in July, with growth rates of 20%, 16.3%, and 15.3%, respectively. However, due to the economic crisis in Argentina, sales to the neighboring country continued to decline last month.
  • According to Herlon Brandão, Director of Foreign Trade Statistics and Studies at the Ministry of Development, Industry, Trade, and Services, exports in 2024 have been relatively stable. This contrasts with 2023, when sales fluctuated significantly in the first half of the year.
  • “This stability is attributed to increased export volumes, while prices in general are falling. Our forecast for 2024 is positive, with an expected 1.7% growth in Brazilian exports by the end of the year,” Brandão explained.

(Source: MercoPress)

Colombia’s Q2 Economic Growth Seen At 2.2% Published: 09 August 2024

  • Colombia's economy is forecast to have grown 2.2% in the second quarter of 2024 from the same period a year earlier, picking up pace from the first three months, a Reuters poll showed on Thursday.
  • If the median estimate from 10 analysts is realized, it would represent a significant acceleration from Colombia's 0.1% annual GDP growth in the second quarter of 2023 and the 0.7% recorded in the first quarter of 2024. It would also be higher than the central bank's forecast of 1.8% for the three months to end-June.
  • "In general, the economy seems to have bottomed out and we have a very gradual recovery," said Sergio Olarte, chief economist for Colombia, adding that the agricultural sector's performance and increased government spending may have contributed to the growth.
  • Colombia's economic growth has been affected by a high benchmark interest rate, currently 10.75%, as well as by stubborn inflation, which stood at 7.18% for the 12 months to end-June, well above the central bank's 3% target.
  • The economy was forecast to expand 0.81% in the second quarter of 2024 versus the first. Analysts now see Latin America's fourth-largest economy growing by 1.5% this year, up from 1.3% in the previous survey. For 2025, analysts continue to see GDP growth at 2.6%.

(Source: Reuters)

No Sign of U.S. Recession in Freight Demand Published: 09 August 2024

  • Shipping giant Maersk, considered a barometer for global trade, is not seeing signs of a U.S. recession as freight demand remains robust, the company’s chief executive said Wednesday. “We’ve seen in the last couple of years, actually, [the shipping container] market remaining surprisingly resilient to all the fear of recessions that there has been,” Vincent Clerc told CNBC’s “Squawk Box Europe” Wednesday, adding that container demand was generally a good indicator of underlying macroeconomic strength.
  • U.S. inventories — goods being stored before delivery or processing — “are higher than they were at the beginning of the year, but they are not at a level that is worrisome or that seems to indicate a significant slowdown right in the offing,” Clerc said, despite noting some unpredictability in numbers for companies replenishing stocks.
  • “We look also at purchase orders from a lot of retailers and consumer brands that need to import into the U.S. for the coming month of demand, and it seems still to be pretty robust ... at least the data and the indicators that we’re having seem to point toward still some good level of confidence that the current consumption levels in the U.S. will continue.”
  • A report released by leasing platform Container xChange on Wednesday said indicators suggest inventories are higher than demand, meaning a less “prosperous time” in the coming months for container traders, the logistics market and retailers who stockpiled.
  • Maersk’s Clerc said the company had been surprised by the resilience of container volumes across the last few years, and said it expected that to continue in the coming quarters — with no indication the global economy is heading toward recessionary territory.

(Source: Reuters)

US Weekly Jobless Claims Drop Calms Market Fears Published: 09 August 2024

  • The number of Americans filing new applications for unemployment benefits fell more than expected last week, calming fears the labour market was unraveling and reinforcing that a gradual softening remains intact.
  • Initial claims for state unemployment benefits fell 17,000 to a seasonally adjusted 233,000 for the week ended Aug. 3, the Labour Department said on Thursday, the largest drop in about 11 months. Economists polled by Reuters had forecast 240,000 claims for the latest week.
  • It also adds more evidence to the possibility that the severity of last week's worse-than-expected monthly payrolls report for July was partly an outsized blip due to the record number of people unable to work because of bad weather.
  • Claims have been on a roughly upward trend since June, with part of the rise blamed on volatility related to the motor vehicle plant shutdowns for retooling and disruptions caused by Hurricane Beryl in Texas. Unadjusted claims dropped 13,589 to 203,054 last week.
  • Over the past few weeks, overall claims have been hovering near the high end of the range this year, but layoffs remain generally low. Government data last week showed the layoffs rate in June was the lowest in more than two years. The slowdown in the labor market is being driven by less aggressive hiring as the Fed's interest rate hikes in 2022 and 2023 dampen demand.
  • The Fed also closely monitors how jobless rolls compare to the size of the labor force to gauge the health of the jobs market. Growth in the labor force has largely kept pace with the gradual rise of those claiming jobless relief and is about where it was before the coronavirus pandemic.

(Source: Reuters)

 

57 Companies Added To Jampro’s Export Max Program Published: 08 August 2024

  • Fifty-seven companies have been onboarded under phase four of the Jamaica Promotions Corporation (JAMPRO) EXPORT MAX program. EXPORT MAX was designed to enhance the competitiveness and sustainability of Jamaican companies to position themselves to enter new and existing international markets to facilitate growth.
  • The Minister of Investment and Commerce, Senator Aubyn Hill, praised the organizers of the initiative for offering vital support to micro, small, and medium-sized enterprises (MSMEs) that are looking to broaden their market reach internationally.
  • “The importance of exporting cannot be overstated. It is the engine that will drive our GDP growth and elevate our per capita GDP. I am particularly proud of the 57 companies in the EXPORT MAX program,” he said, pointing out that 36 entities are operated by women.
  • Meanwhile, JAMPRO President Shullette Cox has stated that the agency has recognized the persistent challenges faced by MSMEs in entering international markets through ongoing dialogue with exporters. In response, the program was redesigned and expanded during the phase for the third cohort, utilising public-private partnerships (PPPs) to respond to the MSMEs’ needs.
  • She further highlighted that EXPORT MAX will aid participating entities in unlocking their full export potential through JAMPRO’s advocacy agenda, mentorship, and coaching program, as well as tailored development and promotional solutions.
  • Launched in 2011, the EXPORT MAX program was implemented by JAMPRO in partnership with the Jamaica Business Development Corporation (JBDC) and Jamaica Manufacturers and Exporters Association (JMEA). JAMPRO provides technical support, while the JBDC facilitates capacity-building through targeted interventions to equip participating firms to access and service identified export markets.

 (Source: Caribbean National Weekly)

  Foreign Direct Investment Falls In Latin America And The Caribbean in 2023 Published: 08 August 2024

  • Latin America and the Caribbean recorded a second consecutive year of decline in the flow of global foreign direct investment (FDI), receiving US$184.304 billion last year. This is 9.9% lower than that registered in 2022 but remains above the average of the last decade, the Economic Commission for Latin America and the Caribbean (ECLAC).
  • The weight of foreign direct investment inflows in the region's GDP also decreased since in 2023, it represented 2.8%. However, the region's participation in total global FDI flows (14%) was higher than the average percentage in the 2010s (11%).
  • The decrease in FDI flows received by Brazil (-14%) and Mexico (-23%), the two countries with the largest participation in total inflows, explains the result of the region. In South America, Peru also saw a fairly sharp decline in FDI inflows (-65%), while Argentina and Chile saw an increase (57% and 19%, respectively).
  • However, Central America and the Caribbean received more investments than in 2022 (12% and 28%, respectively). In Central America, nearly all the countries received more FDI, with notable growth in Costa Rica (28%) and Honduras (33%), while the increase in the Caribbean is due mainly to greater inflows in Guyana (64%) and the Dominican Republic (7%).
  • FDI inflows into Jamaica were 18% higher in 2023 than in 2022. However, the total amount, US$ 377 million, was below the average of the last decade, and the momentum of the pre-pandemic period has never been regained. Inflows were mainly concentrated in the service sector, which accounted for 85% of the total and registered its largest inflows since 2016. The attractiveness of the service sector in Jamaica was also reflected in project announcements, which, in the case of business services, amounted to some US$ 10 million, 82% higher than the amount announced in 2022.
  • “Foreign Direct Investment can help tackle, in particular, the first of the three development traps in which Latin America and the Caribbean is caught: the trap of low capacity for growth. To this end, we need policies to attract investments that put emphasis not only on attracting them but also on what happens once they are established, and that connect these policies with the productive development policies of countries and their territories. All of this requires strengthening the technical, operational, political and prospective (TOPP) capabilities in this area,” ECLAC’s Executive Secretary, José Manuel Salazar-Xirinachs, said.

(Source: United Nations)

  Dominican Republic’s Central Bank Maintains Interest Rate At 7% Annually Published: 08 August 2024

  • In its July 2024 monetary policy meeting, the Central Bank of the Dominican Republic (BCRD) decided to keep its policy interest rate (TPM) steady at 7.00% annually. This decision reflects the evolution of the international environment, particularly the sustained high interest rates in the United States, increased commodity prices, and higher container shipping costs.
  • The BCRD also announced that the overnight liquidity expansion facility rate remains at 7.50% annually, while the overnight deposit rate continues at 5.50% annually. These decisions consider the robust performance of the Dominican economy and the growth of private credit, with inflation remaining within the target range of 4.0% ± 1.0%.
  • Interannual inflation in the Dominican Republic has significantly decreased, standing at 3.46% in June 2024, within the lower range of the target due to the monetary and fiscal policies implemented over the past year. Core inflation, which excludes the most volatile components of the basket and is more directly associated with monetary conditions, was around the target center at 3.98% in June 2024.
  • National economic activity expanded by 6.2% year-on-year in June, with an average growth of 5.1% in the first half of 2024, aligning with its potential. The economy is expected to grow by around 5% in 2024, one of the highest expansions in the region, according to international organizations like the International Monetary Fund (IMF) and the World Bank.
  • Relative exchange rate stability has been maintained, and international reserves have increased to over US$15.2 billion in July, equivalent to more than 12% of the country’s gross domestic product (GDP) and around six months of imports, exceeding the metrics recommended by the IMF.

 (Source: Dominica Today)

Canada's Ivey PMI shows activity expanding at a slower pace in July Published: 08 August 2024

  • Canadian economic activity expanded at a slower pace in July as a measure of inflation fell to a four-month low, Ivey Purchasing Managers Index (PMI) data showed on Wednesday.
  • The seasonally adjusted index fell to 57.6 from 62.5 in June. The Ivey PMI measures the month-to-month variation in economic activity as indicated by a panel of purchasing managers from across Canada. A reading above 50 indicates an increase in activity.
  • The gauge of employment rose to an adjusted 56.1 from 52.9 in June, while the prices index was at 59.2, down from 62.3 and its lowest level since March. The unadjusted PMI fell to 55.3 from 62.4.

(Source: Reuters)

US household Debt Levels Edge Up In Q2 Published: 08 August 2024

  • Total U.S. household debt levels edged up in the second quarter, but overall delinquency rates stabilised, indicating that borrowers are still in decent enough shape to support the economy, a report from the Federal Reserve Bank of New York said on Tuesday.
  • The bank report, part of its survey of household debt and credit conditions, showed that overall debt levels rose by $109Nn, or 0.6%, in the second quarter to $17.80 trillion. Overall borrowing levels are now $3.7Tn above where they were at the end of 2019.
  • Worse-than-expected job market data last week has made financial markets nervous that the economy may be on the cusp of a downturn. Fed policymakers, who already signaled they expect to begin cutting rates in September now that inflation is near the 2% target rate, have said they don't want to wait too long before lowering rates and have cited delinquencies as one area they are closely monitoring.
  • On that front, there was some relief with the report showing that overall delinquency rates remained at 3.2%, unchanged from the first quarter, and still well below the 4.7% rate seen at the end of 2019 before the coronavirus pandemic. However, transitions in delinquent borrowing levels rose slightly in the second quarter for credit cards and auto loans, both remaining elevated although the pace of worsening slowed.
  • Mortgage balances were up by $77Bn to $12.52Tn, while auto loan levels increased by $10Tn, and overall credit card borrowing outstanding rose by $27Bn by the end of the quarter to $1.14Tn. Credit card balances during the quarter were 5.8% above the level they stood at a year ago. Retail cards and other consumer loans were effectively flat, while student loan balances declined by $10Bn.

(Source: Reuters)

 

tTech Announces Appointment of Chief Operating Officer Published: 07 August 2024

  • Kevin Gordon, the Chief Executive Officer of tTech Limited, has announced the appointment of Rob Mayo-Smith as the company's Chief Operating Officer. The appointment became effective July 25, 2024.
  • Rob Mayo-Smith has worked across the Caribbean in several senior positions, including CFO, CEO, regional CEO for Digicel, and Country Manager for Cable and Wireless. As COO, he will be responsible for managing the day-to-day operations of tTech.
  • On July 11, 2024, the Directors of tTech Limited disclosed that two majority shareholders, Edward "Teddy" Alexander, and G. Christopher Reckord, divested 52,012,834 tTech shares. This sale constituted 49.1% of the issued shares of tTech Limited and was acquired by Simply Secure Group.
  • Simply Secure Group, a security service provider situated in Ft. Lauderdale, Florida, is owned by Kevin Gordon and Rob Mayo-Smith, who currently hold the positions of CEO and COO at tTech, respectively.
  • The acquisition is anticipated to create synergistic benefits for both companies, especially in the realm of cybersecurity.

 (Sources: JSE & NCBCM Research)