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Strong U.S. Worker Productivity Keeps Labour Costs in Check in The Fourth Quarter Published: 02 February 2024

  • U.S. worker productivity grew faster than expected in the fourth quarter, keeping unit labour costs contained and giving the Federal Reserve another boost in the fight against inflation.
  • Labor market momentum is also fading, though gradually, which could further help to curb wage inflation. First-time applications for unemployment benefits rose to a two-month high last week, other data from the Labor Department showed on Thursday. The number of people on unemployment rolls was also the highest in two months.
  • The reports followed news on Wednesday that compensation costs rose in the fourth quarter at the slowest pace since 2021.
  • The U.S. central bank left interest rates unchanged on Wednesday. Fed Chair Jerome Powell offered a sweeping endorsement of the economy's strength, telling reporters that interest rates had peaked and would move lower in coming months.
  • "Inflation is increasingly coming back under control as the economy is more productive, keeping labour costs in check, and the labour market is rebalancing," said Christopher Rupkey, chief economist at FWDBONDS in New York. "This is what Fed officials are looking for to deliver the interest rate cuts the market is clamouring for later on this year."

(Source: Reuters)


Fosrich to Consider Additional Public Offering Published: 01 February 2024

  • Fosrich Company Limited has advised that its Board of Directors will be meeting on the 6th of February 2024 to consider recommending to its shareholders at an Extraordinary General Meeting, certain resolutions to facilitate an Additional Public Offering of ordinary shares.
  • This is the second time Fosrich is entering the market in less than a year, following its August rights issue to fund the second phase of its new 30,000 square foot Fulfilment Centre at 76 Molynes Road.
  • The company over the last two years has reaped success through its entry into the manufacturing and distribution of solid PVC pipes and conduits and has announced that it is partnering with Huawei Fusion Solar to deliver battery energy-storage systems.
  • While there is no information to state what the proceeds may be used for, we believe that the funds will be used to support the company’s growth initiatives.

(Source: JSE)

United Oil Granted License Extension for Continuation of Oil Exploration Off-Shore Jamaica Published: 01 February 2024

  • United Oil & Gas has been granted an extension to its licence to explore oil off-shore Jamaica after receiving an official extension to Jan. 31, 2026, from the Jamaican Ministry of Science, Energy, Telecommunications, and Transport (MSETT).
  • The Walton-Morant license covers 22,400 square kilometers and could contain over 2.4Bn barrels of fuel resource, according to the company, citing an audit by Gaffney Cline & Associates. This would be more than one-fifth (1/5th) of Guyana’s oil reserve, which is the 17th largest in the world.
  • During the license extension, United Oil and Gas will undertake additional technical studies, including piston core sampling and seismic reprocessing, to further de-risk the petroleum system and better define the prospects and leads identified on the license. Additionally, United will continue a farm-out process and re-engage with interested parties.
  • United holds 100% working interest in Walton-Morant. However, it is seeking a strategic partner to support its planned work programme, including piston core surveying and seismic reprocessing.

 (Source: Oil & Gas Journal)

Driving a Secure Cashless Ecosystem in Trinidad & Tobago Published: 01 February 2024

  • Cashless payments are experiencing promising growth in Trinidad & Tobago, fuelled by the increasing adoption of digital technologies. With this surge towards digital, cybercriminals are becoming increasingly sophisticated and capitalising on vulnerabilities.
  • While this is a global tendency, developing countries like Trinidad & Tobago are also facing a significant rise in phishing schemes, attacks targeting e-commerce, 'free gift' scams and ransomware, among others.
  • Despite this challenge and in anticipation of a growing and evolving threat, Trinidad & Tobago has been making tremendous strides in securing the payments ecosystem.
  • Recent milestones include the migration of the mag strip debit cards to a Visa Debit Card secured with EMV (Europay, Mastercard, and Visa) contactless technology; merchants' rapid transition to 3DS 2.0 secure (an advanced e-commerce authentication protocol pioneered by Visa); and local issuers working closely with Visa Advanced Authorization – a solution that analyses up to 500 unique risk factors to detect fraud faster, and other AI-enabled transactional scoring tools.
  • However, more can be done to protect the integrity of payments, while also establishing the infrastructure to drive more innovation. This includes the implementation of tokens, a security technology that replaces sensitive account information with a unique digital identifier.
  • In addition, merchants should consider incorporating a transactional risk scoring tool, like CyberSource's Decision Manager, which leverages AI technology to help merchants distinguish between fraudulent and legitimate payment transactions.

(Source: Trinidad Express Newspaper)

Dominican Economy Recorded 2.4% Growth in 2023 Published: 01 February 2024

  • The Dominican Republic’s Central Bank (BCRD) reported a 2.4% year-on-year expansion in the economy for 2023, surpassing initial projections and exceeding the Latin American average growth estimated at 2.2% by the World Bank.
  • The Monthly Indicator of Economic Activity (IMAE), a key indicator of robust economic performance, recorded a 4.7% year-on-year expansion in December 2023, marking the highest monthly rate of the year.
  • Inflation, on the other hand, showed a downward trend, ending 2023 with an annual rate of 3.57%, the lowest in the last five years. This achievement positions the Dominican Republic below the central bank target range of 4.0% ± 1.0% set in the monetary program and could mean further monetary policy loosening in 2024.
  • Notably, BCRD is expected to reduce its monetary policy rate by another 200 basis points to 5.00% by end-2024 through a measured and cautious rate loosening cycle, especially given uncertainty regarding the scope and timing of the US Federal Reserve’s rate cutting cycle. 
  • The tourism sector played a pivotal role in economic growth, with tourism income reaching US$9,828.9Mn, a 16.9% year-on-year increase from 2022. Remittances received in 2023 amounted to US$10.16Bn, growing by 3.1% compared to the previous year. Foreign direct investment (FDI) also saw a significant increase, reaching US$4.38Bn in 2023, a 9.2% rise from the previous year. Sectors such as tourism, energy, and real estate stood out in this FDI increase. 
  • These optimistic figures position the Dominican economy for favourable performance in 2024, with growth projections of 5%, one of the highest in Latin America. The expectation is that monetary stimulus, public investment, and continued foreign direct investment will further boost economic activity while maintaining inflation within established parameters.

(Source: Dominican Today)

Private Payroll Growth Slowed to Just 107,000 in January, Below Expectations Published: 01 February 2024

  • Private payroll growth declined sharply in January, a possible sign that the U.S. labour market is heading for a slowdown this year, ADP reported Wednesday. Companies added 107,000 workers in the first month of 2024, off from the downwardly revised 158,000 in December and below the Dow Jones estimate for 150,000, according to the payrolls processing firm.
  • Only one sector — information services (-9,000) — reported a decline, but hiring was slow across virtually all sectors. Leisure and hospitality posted the biggest increase, with an additional 28,000 workers, while trade, transportation, and utilities added 23,000, and construction rose by 22,000. Services-providing companies were responsible for 77,000 jobs, with goods producers adding the rest.
  • The release comes two days ahead of the Labor Department’s nonfarm payrolls report, which is expected to show growth of 185,000, against the 216,000 increase in December.
  • While the ADP data can provide a barometer for private sector hiring, the two reports often differ, with ADP often undershooting the Labor Department’s numbers. On wage gains, ADP reported a 5.2% annual rise, which has exceeded the government’s measure of average hourly earnings.
  • “Wages adjusted for inflation have improved over the past six months, and the economy looks like it’s headed toward a soft landing in the U.S. and globally,” said ADP’s chief economist, Nela Richardson. Midsize establishments, with between 50 and 499 employees, led job creation, adding 61,000. Small businesses added just 25,000.

(Source: Reuters)

Europe, Africa Crude Market Tightens on Red Sea Disruptions, China Demand Published: 01 February 2024

  • The Brent crude market structure and some physical markets in Europe and Africa reflect tighter supply, resulting partly from concern about shipping delays due to vessels avoiding the Red Sea, according to traders, LSEG data, and analysts.
  • Disruptions, alongside outages and heightened Chinese demand, amplify competition for crude supply not transiting the Suez Canal. European markets are notably affected, as disruptions prompt diversions from the Red Sea following airstrikes in Yemen by the United States and Britain.
  • Brent crude futures exhibit heightened bullishness, with the first-month contract premium over the six-month contract reaching $2.15 a barrel. European refiners face the most significant impact on the physical front, with a notable decrease in Middle Eastern crude heading to Europe.

(Source: The Daily Star)

Unemployment At Record Low; 4.2% October 2023 Published: 31 January 2024

  • The Statistical Institute of Jamaica (STATIN) reported that the unemployment rate in October 2023 was 4.2%, 2.9 percentage points lower than in October 2021.
  • STATIN noted that it compared the October 2023 Labour Force Survey findings with the corresponding 2021 results. This is because no Labour Force Survey was conducted in October 2022 due to the implementation of the 2022 Population & Housing Census.
  • The unemployment rate for October 2023 was also 0.3 percentage points lower than April 2023 and 0.4 percentage points lower than July 2023. The unemployment rate for males was 3.1%, down from 5.4% in October 2021 and 5.4% for females, down from 9.0% in the comparable quarter of 2021.
  • In October 2023, there were 724,600 people outside the labour force, a 5.5% decrease from 766,900 in October 2021. In April, there were 1,100 fewer people out of work, but in July 2023, there were 1,800 more. There were 291,700 males and 432,900 females out of the labour force. In the current quarter, compared to October 2021, there were 22,100 (7.0%) fewer males and 20,200 (4.5%) fewer females working outside the labour force.
  • The largest increase in employment by occupation group was in ‘Service Workers and Shop and Market Sales Workers’ with 308,400 persons employed in October 2023. This represents an 11.2% increase when compared to October 2021. Within this occupation group, male employment increased by 13,500 (14.0%) and female employment by 17,500 (9.7%).
  • In October 2023, there were 152,600 persons working in ‘Real Estate and Other Business Services’ and 133,200 persons in ‘Construction,’ an increase of 16.8% and 16.9%, respectively. These represent the largest increases by industry group.
  • While lower unemployment bodes well for economic growth and job creation, it could also put upward pressure on wages and keep inflation elevated.

(Source: STATIN)

Jamaica to See Over US$2Bn in New Investments from Spanish Investors in 2024 Published: 31 January 2024

  • On the heels of the most successful participation at FITUR (International Tourism Trade Fair) in Madrid, Minister of Tourism Hon Edmund Bartlett has announced the largest Spanish investment of over US$2Bn.The move will create approximately 19,000 new jobs in construction and tourism services.
  • Minister Bartlett and his team concluded negotiations with three major Spanish hoteliers who are now in the advanced stages of development approval in Jamaica for groundbreaking events this year.
  • The projects will see luxury rooms in Lucea, Hanover by Grand Palladium; housing units for tourism workers; a Convention Centre; entertainment facilities; and golf courses, among other amenities.
  • Bahia Principe near Runaway, Bay St Ann, led by Spain's Pinero family, will have two new luxury hotels and cosmopolitan villas, as well as a residential neighbourhood, fishermen village, PGA golf course, private schools and entertainment, dozens of pools, and walking trails. This development is also expected to employ 12,500 workers. Luxury brand Secrets Resorts will construct several hundred rooms in Richmond St Ann, employing 2000 persons.
  • Minister Bartlett met with all the current investors from Spain at the Grand Melia Palacio De Los DUQUES in Madrid, Spain, where these investment projects were presented and confirmed. As the Spanish investors continue to grow their businesses on the island, it will increase the economic benefits for the communities and at the national level.

(Source: JIS News)

Central Bank Projects Bahamian Economy to Grow in Low Two Percent Range in 2024 Published: 31 January 2024

  • The Central Bank of Bahamas predicts economic growth to be in the low 2.0% range, still moderately above the estimate of the economy’s medium-term potential (below 2.0% per annum).
  •  In 2023, the Bahamian economy was estimated to have grown in the 4.0% range, a levelling off from the significant post-pandemic recovery of around 14.0% in 2022. This period captured a robust boost in the cruise sector’s contribution, complete occupancy recovery in the stopover sector, and healthy appreciation in average pricing for stopover accommodations among hotels and vacation rental properties.
  • In 2024, however, growth is expected to be within the low 2.0% range, still moderately above the estimate of the economy’s medium-term potential. Further, earlier this month, the World Bank revised its 2024 growth projection for The Bahamas down from 2.0% to 1.8%.
  • According to Rolle, the Central Bank expects that growth in 2024 and beyond will settle further to more closely resemble The Bahamas’ longer-term potential. However, a period of acceleration could occur after hotel capacity is replenished in New Providence.
  • Central Bank Governor John Rolle stated that although the economy has a positive outlook for 2024, enabling more employment creation and continued reduction in the fiscal deficit, downside risks persist from potential headwinds to tourism, particularly if international central banks prolong their fight against inflation. Additionally, travel demand and import inflation remain vulnerable to the harmful effects of conflicts in Europe and the Middle East.

(Source: Eyewitness News)