• Productive Business Solutions Limited (“PBS”) announced that it has reached an agreement with Xerox Holdings Corporation (“Xerox”), which is listed on the NASDAQ stock exchange, to acquire its businesses in Peru and Ecuador.
• Following the acquisition, PBS will become the exclusive distribution partner for Xerox in Peru and Ecuador, where both companies will continue to operate as subsidiaries of PBS.
• PBS has partnered with Xerox for over two decades. During this period, the company has consistently delivered a comprehensive suite of products and professional services to its clients across Central America, the Caribbean, and South America.
• This strategic expansion in Peru and Ecuador further solidifies the company’s presence in Latin America, extends its footprint to a total of 24 countries and bolsters its workforce to over 3,000 IT professionals.

(Source: JSE)

• The Bank of Jamaica (BOJ) has issued new service-level standards as guidelines for the operation of Automated Banking Machines (ABMs) by deposit-taking institutions (DTIs) which are regulated by BOJ.
• The new standards were issued on April 2 and DTIs have a nine-month transition period to bring themselves into conformity with the guidelines, given the far-reaching nature of the service-level standards.
• Compliance will be assessed through BOJ’s review and publication of monthly reports from the DTIs. No monetary sanctions will be applied as a result of breaches of the guidelines; however, non-adherence may give rise to supervisory concerns around safety and soundness with the attendant supervisory consequences.
• Monthly reports on the performance of each DTI’s fleet of ABMs will be published with a two-month lag. These reports will include the geographical distribution of ABMs, the number of machines that were installed, the proportion of ABMs that were operational for the reporting period, the uptime for operational machines over the period and the recovery time for malfunctioning machines.
• The ABM standards have been issued in a context where, despite the increasing availability and use of electronic payment methods, a significant number of Jamaicans still rely on cash to conduct transactions.
• The new framework will be supported by appropriate legislation under the Twin Peaks system of financial sector regulation, which is being developed. The standards also form part of the practising of the Twin Peaks regime ahead of the passage of supporting legislation.
• The highlights of the standards include; Availability of Cash, Maintenance & Management of Service Disruption, ABM Fees and Charges, Deployment of Machines, Accessibility and Ease-of-Use, Fraud Minimisation, Safety and Security of Customers and Financial Education of ABM Users.

(Source: JSE)

• The severe drought which has forced the Panama Canal, one of the world's busiest trade passages, to limit daily crossings could impact global supply chains during a period of high demand, S&P Global said on Wednesday.
• The canal has imposed several restrictions since 2023, though last month the Panama Canal Authority bumped up daily crossings to 27, from 24, as water levels rose at the man-made Gatun Lake, which feeds into the canal.
• "Capacity pressures at the Panama Canal are starting to affect supply chains," S&P Global said in an analyst report on the transportation of cargo and raw materials. "Container ships have yet to feel the impact in light of their priority status, although the situation is changing."
• Container ships have priority to pass through the Panama Canal, but transit restrictions have hurt other categories, particularly bulk carriers.
• If rains return in May as expected, the canal authority plans to ramp daily slots back up to about 36 per day, the average during the rainy season.
• The need to maintain water levels at the reservoirs feeding into the canal has prevented it from absorbing demand from shippers seeking alternative routes away from the Red Sea, where Houthi attackers have blocked the passage of ships in the Suez Canal, the world's busiest waterway.

(Source: Reuters)

• Chile's GDP is expected to grow 2% to 3% in 2024, up from a previous forecast of 1.25% to 2.25% growth, the country's central bank said on Wednesday.
• The revised forecast was issued a day after slashing its benchmark interest rate by 75 basis points to 6.5% and signaling further rate cuts.
• Chile's economic activity has surprised to the upside in early 2024, overshooting expectations in January and February.
• According to the Central bank, inflation has declined sharply towards the 3% target after peaking in 2022. This was largely due to reduced domestic spending and a narrowing activity gap.
• The central bank said it now projects headline inflation to end this year at 3.8% in light of the local currency's recent depreciation, up from a previous estimate of 2.9%, but still sees it converging to the target within its two-year policy horizon.
• It also projected GDP growth in 2025 and 2026 to range between 1.5% and 2.5%, indicating a convergence to the economy's potential growth rate. The projection for next year came in slightly below the previous growth forecast of 2% to 3%.

(Source: Reuters)

• Federal Reserve officials, including U.S. central bank chief Jerome Powell, on Wednesday continued focusing on the need for more debate and data before interest rates are cut, a move financial markets expect to occur in June.
• "Recent readings on both job gains and inflation have come in higher than expected," Powell said in a speech to the Stanford Graduate School of Business, and while policymakers generally agree rates can fall later this year, that will only happen once they "have greater confidence that inflation is moving sustainably down" to the Fed's 2% target.
• His remarks repeated the language the Fed has adopted as it tries to balance the risks of cutting interest rates before inflation is truly controlled with the risks of suppressing economic activity more than is needed.
• As he did at his press conference at the end of the Fed's last policy meeting on March 20, Powell maintained the baseline outlook that rates will fall "later this year," and said that recent data did not "materially change the overall picture which continues to be one of solid growth, a strong but rebalancing labor market, and inflation moving down toward 2% on a sometimes bumpy path."
• However, he hasn’t hinted at when the Fed might loosen its grip on credit, with upcoming jobs data, including the March nonfarm payrolls report on Friday, and incoming inflation readings next week, important in shaping the outlook for the central bank's April 30-May 1 and June 11-12 policy meetings.
• "Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy," Powell said, with decisions made "meeting by meeting.

(Source: Reuters)

• Increasing Treasury yields are testing the ongoing rally in U.S. stocks, which have reached record highs, making them more expensive. This rally was partly fueled by expectations of Federal Reserve interest rate cuts, but rising yields are altering those expectations.
• Despite a strong economy and corporate earnings, concerns arise over stock vulnerability due to elevated valuations amidst climbing yields. Higher yields increase the attractiveness of Treasury bonds over equities and raise capital costs for businesses and households.
• Initially, there were expectations for significant Federal Reserve rate cuts in response to economic conditions. However, strong economic data has caused doubts regarding the extent of rate cuts the Fed will implement, impacting market sentiment.
• Various indicators suggest that stock market valuations are less favourable, with some investors predicting a long-awaited correction. The absence of significant market declines since October contrasts with historical trends, raising concerns.
• Stocks' response to rising yields hinges on perceptions of economic strength and inflation trends. If yields rise due to robust economic growth, investors may remain optimistic. However, slowing growth coupled with climbing inflation could unsettle investors. Key data releases, such as jobs reports and earnings season, will influence market sentiment in the near term.

(Source: Reuters)

• Honey Bun (1982) Limited (HONBUN) announced that its Board of Directors approved the Company to sign an agreement to expand its capacity by leasing a location at MJS Technology Park, Angels, Spanish Town. 

• The company signed a long-term lease agreement for the 160,000 square feet which signifies its optimism about future prospects.

• Honey Bun’s CEO Michelle Chong highlighted that the expansion was necessary as the company’s products are in high demand and that the company has outgrown its current facility in Retirement Crescent, Kingston.

• Deputy CEO Daniel Chong noted that the long-term-lease of the new four-and-a-half-acre property will initially see Honey Bun moving half of its operation from its current Kingston facility and will be operational in the next 7 to 10 months.

• This expansion will more than double its manufacturing capacity and is part of the company’s aggressive growth and expansion strategy.

• The new facility will be between two major highways, giving Honey Bun greater access to markets outside the Kinston and St. Andrew metropolitan area.

• According to Executive Chairman Herbert Chong, the current facility will continue to supply Kingston and St Andrew, St Thomas, Portland and St Mary, while the new Angels facility will service the rest of the island.

(Sources: JSE, NCBCM Research)

• As visitor arrivals continue to grow, the Tourism Minister, Hon. Edmund Bartlett, is highlighting the need to increase the production of goods and supplies to meet the growing demand in the sector.

• He noted that while the demand for agricultural produce for manufactured goods is escalating, supply is an issue.

• He was speaking at the Montego Bay Chamber of Commerce and Industry’s Expo 2024, held recently at the Montego Bay Convention Centre in Rose Hall, St. James.

• The Minister noted that last year, Jamaica welcomed four million tourists who spent approximately US$4 billion. Since the start of 2024, close to 1.5 million tourists have visited the island’s shores, generating foreign exchange earnings of almost US$2 billion.

• He highlighted that increasing local production is critical in enabling the country to retain a larger portion of the tourist dollar, ensure the sector’s sustainability and maximise economic benefits for the country.

• The Minister further emphasised that the country should start looking at the supply side and how it can bring more food, pots, pans, cans and kettles to be utilised in the service of tourism.

(Source: JIS)

• As visitor arrivals continue to grow, the Tourism Minister, Hon. Edmund Bartlett, is highlighting the need to increase the production of goods and supplies to meet the growing demand in the sector.

• He noted that while the demand for agricultural produce for manufactured goods is escalating, supply is an issue.

• He was speaking at the Montego Bay Chamber of Commerce and Industry’s Expo 2024, held recently at the Montego Bay Convention Centre in Rose Hall, St. James.

• The Minister noted that last year, Jamaica welcomed four million tourists who spent approximately US$4 billion. Since the start of 2024, close to 1.5 million tourists have visited the island’s shores, generating foreign exchange earnings of almost US$2 billion.

• He highlighted that increasing local production is critical in enabling the country to retain a larger portion of the tourist dollar, ensure the sector’s sustainability and maximise economic benefits for the country.

• The Minister further emphasised that the country should start looking at the supply side and how it can bring more food, pots, pans, cans and kettles to be utilised in the service of tourism.

(Source: JIS)

• Chile's central bank cut its benchmark interest rate on Tuesday by 75 basis points to 6.50%, in a unanimous decision by its governing board, saying the rate would likely be reduced further.

• The cut is in line with forecasts in a traders' poll last week, which also predicted the bank will reduce the rate to 4.25% within 12 months.

• Chile's central bank raised interest rates from 0.50% in mid-2021 to a cycle-high of 11.25% in late 2022. The bank held at that rate before kicking off monetary easing in July 2023, as inflation began to cool.

• Chile's annual inflation peaked at 14.1% in August 2022 and came down to 3.9% at the end of 2023. It has since gone back up, reaching 4.5% in February.

• The central bank's board on Tuesday added that inflation expectations are aligned with its 3% target, and "rising inflation figures at the beginning of the year and higher imported cost pressures emphasize the need to continue closely monitoring its evolution."

• While Chile faced a sharp economic downturn in 2023 after a rapid post-pandemic recovery, the economy "has succeeded in closing the significant macroeconomic imbalances of previous years," the board said.

(Source: Reuters)