• Electrical, lighting and solar products distributor FosRich Company Limited through FosRich USA Inc. has entered the United States market by opening an office in Tennessee, strategically positioning itself to capitalise on opportunities, particularly under the Federal Government Infrastructure Program. The company intends to concentrate initially on three States, beginning with Tennessee.
• Last week, FosRich signed a lease agreement for a physical office space in Tennessee, outfitted the office and engaged staff to advance its data collection and market research efforts. Furthermore, FosRich would have also engaged potential suppliers to establish partnerships to support both its American and Jamaican operations.
• During the company’s annual general meeting on June 18^th, 2024, Cecil Foster, Managing Director of FosRich, highlighted that the company is working with small and medium sized businesses to supply hardware products.
• Additionally, the company has also been expanding locally. Construction of its new FosRich Superstore & Corporate Offices at 76 Molynes Road is now at an advanced stage, with the completion date projected to be at the end of Q3 2024. It has also recently opened new retail outlets in Drax Hall, St. Ann, and Montego Bay, St. James.
• Management noted that the company continues to implement its strategic plans, including plans for the expansion of revenues through the new superstore and all its offerings, the expansion of key product lines, and the driving of its export market thrust.
• Fosrich’s stock price has fallen 8.5% since the start of the calendar year. The stock closed Thursday’s trading session at $2.15 and currently trades at a P/E of 53.8x, which is well above the Junior Market Distribution Sector Average of 15.5x, suggesting that investors may still be optimistic about the company’s future growth prospects despite recent earnings decline.

(Sources: JSE, FosRich, and NCBCM Research)

• Exports from the Bahamas during the first quarter of the year saw a significant decrease of 44% compared to the same period in 2023, according to recent data from the Bahamas National Statistical Institute (BNSI).
• The latest figures reveal that total exports (including domestic and re-exports) for the first quarter of 2024 amounted to $95Mn, marking a substantial decline from the corresponding period last year.
• The primary export categories were ‘Food and Live Animals’ totalling $24Mn (25% of total exports), ‘Mineral Fuels, Lubricants, and Related Articles’ totalling $23Mn (24% of total exports), and ‘Crude Minerals’ totalling $14Mn (15% of total exports).
• The BNSI report highlighted significant declines in exports of Manufactured Goods Classified Chiefly by Materials, ‘Machinery & Transport Equipment’, and ‘Mineral Fuels, Lubricants, and Related Materials’, which saw decreases of 82%, 65%, and 54% respectively.
• Additionally, trade data showed that imports into the Bahamas amounted to an estimated $1.027Bn, representing an increase of less than 1% compared to the same period last year.

 (Source: Eyewitness News)

• The Central Bank of the Dominican Republic (BCRD) reported that remittances received between January and May 2024 totalled US$4,382.3Mn, marking a 5.0% increase compared to the same period the previous year.
• This continues the trend of year-on-year growth in remittance flows observed in 2023. In May alone, US$887.1Mn in remittances were received, a 0.7% increase over May 2023. These funds from the diaspora significantly impact consumption, investment, and the financing of the most vulnerable sectors in the country.
• The BCRD attributes the behaviour of remittances largely to the economic performance of the United States, from which 87.3% of formal remittances in May originated, amounting to US$713.8Mn.
• Remittances also came through formal channels from other countries, including Spain (US$39.4Mn, 4.8% of the total), Haiti (1.0%), and Italy (0.7%). Additional countries contributing to remittances included Switzerland, Canada, and Panama.
• Looking at the broader external sector, the BCRD expects foreign exchange earnings to grow favourably in 2024, driven by tourism, foreign direct investment (FDI), exports, and remittances.
• Estimates suggest that remittances and FDI flows will reach approximately US$10.4Bn and US$4.5Bn, respectively, by the end of the year. These inflows contribute to the relative stability of the exchange rate, with the national currency depreciating by 1.9% by the end of May 2024 compared to the end of 2023. Furthermore, increased external income flows have helped maintain robust international reserves, which stood at US$13,937.5Mn at the end of May, covering about 5.0 months of imports and equivalent to 11.3% of GDP, exceeding IMF-recommended thresholds.

(Source: Dominican Today)

• Traders upped bets for a Bank of England (BoE) rate cut in August, helping to underpin a pre-election rally for UK stocks and government bonds even though the central bank left rates on hold at a 16-year high on Thursday. After the BoE delivered its widely expected decision, it hinted that it was edging closer to cuts, prompting money markets to place a 44.0% probability on a move in August, up from around 32.0% a day earlier.
• Wednesday's data showing UK inflation has dropped to the BoE's 2% target have encouraged those bets. Investors now widely see rate cuts boosting the UK economy alongside a predicted landslide in the July 4 general election for the opposition Labour Party, which claims it can rebuild growth and run the country's debt-laden finances cautiously.
• "Rate cuts are definitely coming, and we have a stable outlook for government for the next few years," Morningstar European strategist Michael Field said.
• James Briggs, a portfolio manager at Janus Henderson, said he had a "relatively upbeat" stance towards UK stocks, corporate credit, and government bonds, known as gilts. He said UK equity and credit valuations did not yet reflect the economy's improving prospects and that gilts would benefit because "that tail risk of unorthodox fiscal policy is off the table. "Two-year gilt yields dropped to their lowest since March after the BoE's decision, LSEG data showed.
• Economists polled by Reuters expect the UK economy to grow by 0.7% this year, in an upgrade to earlier forecasts that had placed Britain at the bottom of the league table for predicted growth among advanced economies in 2024. Overall, the mood among investors towards the UK was buoyant as rate cut hopes added to the pre-election buzz.

(Source: Reuters)

• The head of the International Monetary Fund on Thursday called on Europe to achieve the full potential of its prized single market, lamenting what she described as a situation that makes the region look like “an ideas supermarket” for the U.S.
• Speaking to CNBC’s Karen Tso, IMF Managing Director Kristalina Georgieva said Europe’s economic performance was strengthening, and inflation was clearly on a downward trajectory. Georgieva said that the IMF is observing an uptick in consumption and expected interest rate cuts from the European Central Bank spelled out good news for investment in the eurozone. She said it would bolster the 20-member bloc’s economic performance.
• In May, the Washington, D.C.-based institute said in a blog post that an IMF report published in 2023 estimated that reducing remaining barriers to the single market for goods and services by 10% could raise European output by as much as 7 percentage points over the long term. “The euro area is now focusing on critical questions for the future. Among them, number one, how to lift up productivity at par with competitors, especially with the U.S.,” Georgieva said.
• The IMF chief reinforced the fund’s growth outlook for the eurozone, saying the bloc was on track to register a growth rate of 0.8% in 2024, compared with 0.4% in 2023 — and increase by 1.5% next year.

(Source: Reuters)

• iCreate Limited, which trades under the symbol ICREATE on the Jamaica Stock Exchange, resumed trading of its ordinary shares effective Wednesday, June 19, 2024.
• According to JSE’s Monthly Regulatory Report - February 2024, the company was suspended effective January 18, 2024, in keeping with JSE Junior Market Rule 505 – Ongoing Requirements, Section 14 – Delisting or Suspension 14 (a) (i), due to its failure to comply with the requirements of JSE Junior Market Rule Appendix 4 – Admission Agreement, Paragraphs 2 and 4.
• iCreate has since published a series of adjustments and addendums to its audited financial statements for the periods 2019-2023 and also included the outstanding shareholdings listing of Directors, Senior Managers and Connected Persons.
• The Jamaica Stock Exchange (JSE) advises that iCreate Limited has addressed all outstanding issues that led to the suspension of trading in its shares on the JSE on January 18, 2024. Therefore, the JSE has lifted the suspension of trading in the ordinary shares of iCreate Limited as the Company is now compliant with the Rules of the JSE.
• iCreate reported a net loss of $2.18Mn in its most recent quarter ending March 31, 2024,  which represents a $9.63Mn (or 81.5%) improvement relative to $11.81Mn loss in the prior period. This improvement was attributed to its acquisition of Visual Vibe.com, which delivered $14.0Mn in profit before tax, representing a $9.0Mn (or 178.7%) increase relative to March 2023. iCreate’s stock price closed at $0.41 before its suspension.
• iCreate’s stock price closed at $0.41 before its and has since increased by 19.5% to close Wednesday’s trading session at $0.49.

(Sources: JSE and NCBCM Research)

• Minister of Tourism, Hon Edmund Bartlett, has embarked on a strong multi-city marketing blitz in the United States starting June 17th. The engagement will include several meetings with airline partners and key interviews with top media houses in New York, Chicago, and Dallas.
• “It is critical that we maintain strong relationships with our tourism partners in the United States, which is our largest source market, bringing in 74% of our arrivals. It is through these strong relationships we have been able to experience continued growth to be 4% up over 2023,” said Minister of Tourism, Hon Edmund Bartlett.
• The multi-city marketing blitz begins in New York with a series of key media interviews and participation at the Caribbean Tourism Organization Week. The Minister will also hold meetings with Senior Executives from major airline operators, JetBlue, Delta and United.
• “The US remains a key source market for Jamaica and as such it is critical that we consistently engage with our critical stakeholders there to find ways to improve our outcomes,” said Donovan White, Director of Tourism.
• Jamaica’s tourism is thriving. Visitation set a record in 2023 with more than 4Mn visitors, and the island is on pace to top that figure in 2024, with more than 2Mn arrivals in the first four months of the year. The forecast for 2024 is 4.58Mn visitors, with a 9.6% increase in earnings of US$4.38Bn.

(Source: JIS)

• Wayne Furbert, the Minister of Transport for Bermuda, said airlift to the island will continue to rise as tourism bounces back from the pandemic.
• Mr Furbert told the House of Assembly that airlift had increased 22% between 2022 and 2023, with air capacity expected to continue rising. He added: “The growth in air travel showcases our ability to not just endure challenges but to emerge stronger, thriving as a destination of choice.”
• Mr Furbert told the House that in 2018, there were a total of 611,000 available Bermuda-bound seats. While that figure dipped 5% in 2019, airlift plummeted in 2020 with the Covid-19 pandemic as flights got grounded internationally. However, he said the number of seats rose from 170,000 to 237,000 in 2021, 356,000 in 2022, and 433,000 last year.
• He highlighted recent developments, including the growth of BermudAir, the return of American Airlines flights from Washington DC, and boosted airlift between the island and Newark, Boston, and Miami. These developments should add to greater tourist numbers for 2024.
• Bermuda’s solid economic growth, with GDP above pre-pandemic levels, reflects its competitive global insurance and reinsurance sector, construction sector, and recovery in tourism. Moody's Investor Services projects GDP growth of around 1.5% in 2023-2025, a conservative but more in line with the economy's pre-pandemic growth performance.
• S&P Global Ratings, however, projects GDP will grow by 3.0% in 2024 and will slow to an average of 1.1% during 2025-2027.

 (Sources: The Royal Gazette & NCBCM Research)

• The International Monetary Fund (IMF) allowed for the disbursement of over $500Mn to Costa Rica last Friday, June 14, after a successful review of the Central American country’s reform programs, the organization said in a statement.
• The IMF Executive Board concluded the sixth and final review under the Extended Fund Facility (EFF) for Costa Rica, allowing for a disbursement equivalent to about US$ 272Mn.
• Further, the IMF Executive Board also concluded the third and final review under Costa Rica’s Resilience and Sustainability Facility (RSF) arrangement, making available about US$ 243Mn in support of Costa Rica’s ambitious climate change agenda.
• “Costa Rica is the first country to complete an RSF arrangement,” which was launched to support poor or vulnerable countries in the face of long-term difficulties caused by global warming, according to the IMF.
• “The completion of the reviews marks the successful conclusion of an ambitious, multi-year, multi-dimensional reform program… that is helping reshape Costa Rica’s economy and advance the climate agenda,” Kenji Okamura, Deputy Managing Director of the IMF, said in a statement.
• The sovereign is expected to grow by 4.0% in 2024 and average 3.0% growth between 2025 and 2029, driven in particular by robust external demand, a recovery in foreign direct investment, and stronger household consumption. Furthermore, Costa Rica stands to benefit from the global "near-shoring" trend, especially in the healthcare and service-related export sectors.

(Sources: IMF & NCBCM Research)

• British inflation returned to its 2% target for the first time in nearly three years in May, but strong underlying price pressures all but rule out a pre-election interest rate cut. While Prime Minister Rishi Sunak welcomed the fall in headline inflation in May, it has likely come too late to turn around his fortunes in British elections on July 4 or to prompt a Bank of England (BoE) rate cut on Thursday.
• Office for National Statistics data showed services price inflation, which the BoE thinks gives a better picture of medium-term inflation risks, was 5.7%. That was down from 5.9% in April but higher than the 5.5% economists had forecast in a Reuters poll or the 5.3% predicted by the BoE last month.
• The drop in annual consumer price inflation from April's 2.3% reading - in line with economists' expectations - took it to its lowest since July 2021 and marks a sharp decline from the 41-year high of 11.1% in October 2022. The fall has been sharper than in the euro zone or the United States, where consumer price inflation in May was 2.6% and 3.3%, respectively, belying concerns a year ago that British inflation was proving unusually sticky.
• The BoE has said a return of inflation to its target is not enough on its own for it to start cutting interest rates. "Rate-setters will still need to weigh the fall in headline inflation against signs that domestic price pressures, such as elevated pay growth, are proving slower to come down," Martin Sartorius, principal economist at the Confederation of British Industry, said.
• The most recent fall in inflation was partly driven by a cut in regulated household energy bills in April - the effect of which will fade later in the year, when the BoE forecasts inflation will rise to 2.6%. Lower food prices were the biggest factor pushing inflation down in May, reducing the annual rate of inflation for food and non-alcoholic drinks to 1.7% from a 45-year high of 19.2% in March 2023.
• Cheaper electrical appliances and a smaller rise in the cost of recreational and cultural activities also helped lower inflation. Higher airfares were the biggest factor to cause services price inflation to fall less than expected. Airfares are volatile, and some economists view them as a poor guide to broader inflation trends.

(Source: Reuters)