• The economy of Grand Bahama has expanded by 10.8%, while New Providence, produced “unmatched” economic expansion in 2023, according to the Bahamas National Statistical Institute (BSNI).

• “Accommodation and food services showed an increase of $436Mn, and arts, other services and household employment, extra-territorial organizations increased by $208Mn. In 2023, New Providence represented 77% of the overall economy of the Bahamas and the island’s economic contribution jumped from $9.937Bn in 2022 to $11.027Bn, representing a nine-year high in The Bahamas,” the report said.

• According to the report, the impact of tourism on the islands was evident beginning in 2020, although exponential growth was experienced during the period 2021 to 2023. The industrial grouping, real estate, owner-occupied and actual rents led the increase at 28%, while the accommodation and food services, arts, other services, household employment, and extraterritorial organizations grew by 23% compared to 2022.

• Overall, New Providence remained the economic powerhouse, accounting for 77% of the Bahamas’ GDP in 2023, and has seen a robust 11% increase in economic activity, mainly in the services sector.

(Source: MagneticMedia)

• The Costa Rican economy continues to stand out for its resilience and capacity for growth. Despite global instability, with wars in Ukraine and tensions in the Middle East, as well as the escalation of geopolitical disputes between China and the United States, Costa Rica achieved growth of 5.1% in 2023.

• Although moderation is anticipated for 2024 and 2025, with rates expected to exceed 3.5%, the country continues to take advantage of opportunities to maintain sustainable economic development, despite external and internal challenges.

• “Despite the fact that the international economy is going through a moment of fragility, we have seen that the Costa Rican economy has continued to grow at good rates. This is due, in part, to a projected slowdown for the North American economy, which continues to be our main trading partner, source of investment and tourism. Also influencing is the appreciation of the exchange rate, which is affecting some sectors, and the normalization of household consumption, which was very high in 2023,” said Rodrigo Cubero, former president of the Central Bank.

• “If there is very strong pressure to increase the exchange rate, the Central Bank will possibly move its monetary exchange rate policy instruments to prevent a very disorderly, rapid and violent adjustment in the exchange rate, especially upwards, endangering its inflation target. We would see an exchange rate that will possibly remain with a slight upward trend, but fluctuating at levels that this year could range between 520 and 540 colones per dollar,” added Cubero.

• The interest rate in Costa Rica in colones is highly determined by the Monetary Policy Rate (MPR) of the Central Bank. At this time, the MPR is at 4.75% and the Central Bank has expressed that it does not anticipate that it will move before the United States Federal Reserve does so, which is expected from September.

• Middle- and low-income U.S. families now have significantly fewer liquid resources like bank deposits than they were on track to have before the disruptions of the COVID-19 pandemic, creating financial strains that pose a risk to consumer spending, the backbone of the economy.

• Research published on Monday by the Federal Reserve Bank of San Francisco showed that for the top 20% of households by income, liquid assets - including cash and funds in savings, checking and money market accounts - rose sharply in 2020 into early 2021. They then dropped gradually and are now about 2% below what would have been expected without the pandemic shock.

• However, for the rest of American households, those liquid assets rose less sharply and the excess was depleted earlier and is now about 13% lower than the projected path prior to the pandemic. At the same time credit card delinquencies among these middle- and low-income families rose earlier, faster, and to "notably higher" rates than for high-income families, they showed.

• S. central bankers have said that continued strength in the real economy has given them room to hold the policy rate in its current 5.25%-5.50% range so as to keep up the downward pressure on inflation. However, recent economic data including a report showing a jump in the unemployment rate to a post-pandemic high of 4.3% and a slowdown in hiring in July - have fueled fears that policy may be becoming too restrictive.

• While consumer spending contributed significantly to the stronger-than-expected pace of economic growth in the second quarter, its monthly growth rate has slowed. Spending growth averaged 0.3% in the three months through June, its slowest average pace in more than a year. Last week, Chicago Fed President Austan Goolsbee said the uptick in credit card delinquencies was among the factors he was watching as a possible sign that policy may be getting tighter than warranted.

(Source: Reuters)

• The US budget deficit exceeded $1.5 trillion with two months to go until the end of the fiscal year, down slightly on 2023 though vastly larger than pre-pandemic times. The $1.52 trillion gap for the 10 months through July was down 6% from the same period last year, Treasury Department data released Wednesday showed. For the month of July, the deficit was $244 billion — 16% smaller than July 2023, adjusted for calendar differences. The adjusted year-to-date narrowing was 5%.

• Higher revenues helped narrow the deficit. Receipts have risen in part because of a deferral of tax deadlines from fiscal 2023 into this year in states that suffered from natural disasters. Affected areas included most of California.

• The interest burden on outstanding US debt remained a major drag on the budget. Interest costs in the first 10 months of the fiscal year totalled $956 billion, up 32% from 2023. The Federal Reserve’s aggressive interest-rate hiking campaign, aimed at quelling inflation, has made debt more expensive to issue for the federal government.

• The weighted average interest rate on outstanding US interest-bearing government debt was 3.33% at the end of July — the highest since January 2010 and up about half a percentage point from a year before.

(Source: Bloomberg)

• TransJamaica Limited recorded net profit of US$13.92Mn for the six months that ended June 30, 2024, a 26.5% yoy increase. The outturn reflects the impact of robust topline growth and modest growth in expenses.
• Aided by higher traffic volumes and movements in the toll tariff, which is reviewed annually, revenue for the six-month period was US$39.65Mn, US$3.44Mn higher when compared to the same period in 2023.
• The company reported operating expenses of US$11.37Mn, marking a 3.8% rise from the US$10.96Mn recorded during the corresponding period in 2023. Elevated intangible amortization and security expenses, which were partly counterbalanced by a reduction in maintenance activities throughout the period, resulted in modest growth in operating expenses.
• However, administrative expenses rose 18.0%, given salary adjustments following a restructuring exercise and the usual annual inflationary increments. The team expanded with the recruitment of extra technical personnel, including a special projects manager tasked with spearheading the infrastructure enhancements throughout the network.
• TransJa's stock price has increased by 13.3% since the start of the calendar year. The stock closed Monday’s trading session at $3.07 and currently trades at a P/E of 9.0x, which is below the Main Market Energy, Industrial, and Materials Sector Average of 9.6x.
• TransJamaican Highway Limited (TJH) recently proposed a US$20.3Mn offer price, along with potential Upside Formula amounts, to acquire the concession to operate Phase 1C of the Highway 2000 toll roads until November 20, 2036. The government’s acceptance is subject to contract and additional conditions. The addition of this new concession should enhance the company's portfolio by introducing a fourth toll road, which is expected to bolster earnings when it becomes operational.

(Sources: JSE and NCBCM Research)

• The Jamaica Business Development Corporation (JBDC) served 2,711 clients from the micro, small, and medium-sized enterprise (MSME) sector in 2023, representing various industries.
• The information is contained in the Planning Institute of Jamaica (JIS) Economic and Social Survey Jamaica 2023, which was tabled in Parliament recently.
• Manufacturing accounted for 16.8% of clients served, followed by the Service sector at 11.1% and Retail at 10.8%. “Another 9.1% included Agriculture, Forestry, Fishing and Hunting. Accounting for the remaining 52.2% were Education, Gift and Craft, Fashion/Apparel, Accommodation, Aromatherapy, Agro-processing, Mining, Finance and Insurance, Accommodation, and Food Services,” the survey said.
• Female-headed MSMEs comprised 50.7% of those assisted, while male-headed MSMEs accounted for 34.7%, with approximately 14.6% being co-owned. The JBDC also conducted 73 virtual webinars, training sessions, and seminars, benefiting more than 2,248 individuals.
• The operationalisation of the Essential Oils Incubator Project in December and the renovated agro-processing incubator also were among the initiatives pursued by the Corporation last year. This project, supported by government funds, provides entrepreneurs in the essential oils industry with access to capital-intensive manufacturing facilities. The agro-processing initiative, funded by the European Union (EU) and managed by the Caribbean Development Bank (CDB), opened in November 2023.
• Equipped with essential machinery, the incubator serves to boost production and exports among micro and small agro-processors. The survey further said that the facility aims to achieve Food Safety System Certification (FSSC) 22000 for the incubator to meet international standards.

(Source: JIS)

• 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 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)

• 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)

• 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)