• The Board of Directors of NCB Financial Group Limited on September 8, 2023, decided that an Extraordinary General Meeting should be held for the company to consider an additional public offering (APO) of new ordinary shares.
• The number of shares sought to be issued by way of APO is expected to be up to 300 million. The NCB Financial Group stock closed Monday's trading session at $70 per share. If the offer were to be floated at that price, the company would be looking to raise up to $21Bn.
• There was no information suggesting what the funds be used for, however, the company will in due course issue a notice regarding arrangements for the extraordinary general meeting.

(Source:  JSE)

• Fitch Solutions forecasts consecutive decelerations in Trinidad and Tobago’s real GDP growth rate in 2023 and 2024 to 2.3% and 1.8% respectively, from 2.6% in 2022.
• The latest national accounts release shows that real GDP growth came in at 1.3% y-o-y in Q123. While this was a slight improvement from the Q422 rate of -0.9%, Fitch believes that economic growth will deteriorate towards the latter half of 2023 and the first half of 2024 thanks to slow export growth, somewhat tight fiscal policy and an elevated unemployment rate.
• Furthermore, Fitch’s somewhat pessimistic forecast is largely underpinned by poor export growth due to slowing hydrocarbon production growth as well as a bleak US growth outlook.
• Despite falling inflation, private consumption growth will also decelerate given elevated unemployment and limited support from the government.
• The US macro outlook remains the key risk to Fitch’s near-term growth forecasts. There exist rising upside risks of a ‘soft landing’ in the US, in which the economy manages to avoid a recession. These risks have grown in the last few months given strong real wage growth, loose fiscal policy and improving financial conditions. Should this materialise, Fitch would look to raise its growth forecasts for T&T, especially that of 2024.

(Source: Fitch Solutions)

• The Central Bank of the Dominican Republic (BCRD) has reported that for the first eight months of 2023, remittances received amounted to $6,769.9Mn, marking a 3.9% growth compared to the same period in the previous year. This growth aligns with the projection of exceeding $10Bn by the end of the year.
• Specifically, in August, remittances reached $860.6Mn, reflecting a 1.4% increase compared to August 2022. However, this figure is $28.8Mn less than what was received in July this year when remittances totalled $889.4Mn.
• The BCRD attributes the behaviour of remittances to the economic performance of the United States, as 84.0% of formal remittance flows in August, approximately $643.6Mn, originated from the United States. Factors contributing to this include a low general unemployment rate of 3.8% in the U.S., similar to levels observed before the pandemic.
• Additionally, the non-manufacturing purchasing managers index (PMI) of the Institute of Supply Management (ISM) registered a value of 54.5 in August, indicating the sustained expansion of the services sector, where a significant portion of the Dominican diaspora resides.
• Looking ahead, the BCRD anticipates continued significant flows of remittances, exports, tourism income, and foreign direct investment throughout 2023. These inflows will continue to influence the relative stability of the exchange rate, with international reserves reaching $15,833.5Mn at the end of August, representing 13.2% of GDP and about 5.9 months of imports, exceeding international organization recommendations.

(Source: Dominican Today)

• Japan's economy grew less than initially estimated in the second quarter and wages slumped in July, casting doubt over central bank projections that solid domestic demand will keep the country on course for a recovery.
• Capital expenditure and private consumption both fell in the April-June period, revised gross domestic product (GDP) data showed on Friday, underscoring the fragile state of Japan's economy, which is already facing headwinds from weakening Chinese and U.S. growth.
• Real wages adjusted for inflation fell in July for a 16th straight month in a sign households continued to feel the pinch from rising prices, separate data showed, boding ill for consumption. Japan's economy grew an annualised 4.8% in April-June, the revised data showed, down from a preliminary estimate of 6.0% growth and below market forecasts for a revised 5.5% expansion.
• The main factor behind the downgrade was a 1.0% drop in capital expenditure, compared with a preliminary flat reading, casting doubt on the BOJ's view that robust corporate spending will underpin Japan's post-pandemic economy. The revised decline was bigger than a median market forecast for a 0.7% fall. Private consumption, which makes up more than half of the economy, fell 0.6% quarter-on-quarter in the April-June period, compared with a preliminary 0.5% decline.
• Exports remained solid in April-June with net external demand contributing 1.8% points to GDP growth, unchanged from the preliminary reading, but shipments to China slumped 13.4% in July to mark the 8th straight month of falls. Overall exports slid 5.0% year-on-year in the first half of August after a 0.3% decline in July, suggesting the global slowdown was taking a toll on the economy.
• Japan's economy has seen a delayed recovery from the COVID-19 pandemic this year, as rising living costs and faltering global demand cloud the outlook. Given such uncertainties, Bank of Japan policymakers have stressed their resolve to keep monetary policy ultra-loose until the recent cost-driven inflation turns into price rises driven by domestic demand and higher wage growth.

(Source: Reuters)

• Everyone — from moms and pops to corporate treasurers and the mega asset managers — is piling in, won over by a unique opportunity: To lock in a 5% yield, and protect themselves from uncertainty over the US economy.
• With rates on cash and cash-like instruments at the highest in more than two decades and offering more income than benchmark US debt or stocks, assets in money-market funds have swelled to a record. But nowhere is that appetite for liquid, high-yielding instruments more apparent than in the market for T-bills where investors have snapped up more than $1 trillion of new notes in just the last three months.
• Demand has been so robust, that the number of bills sitting on balance sheets of primary dealers, the first port of call for Treasury debt sales, plummeted to about $45 billion last month after touching an all-time high of $116 billion in July. It has also made the paper more expensive, driving the difference between bill yields and so-called overnight index swaps — which investors use to measure the Fed’s path — back toward zero after climbing into positive territory for the first time since 2020.
• The narrowing trend has prompted some money-market funds that aren’t required to buy only T-bills to take a more cautious view as they await better entry levels and more clarity on the economy and the Fed’s policy path.
• With US central bank officials entering a quiet period ahead of their policy meeting Sept. 19-20, the monthly inflation report Wednesday will be closely watched for clues to how much still needs to be done to rein in price growth. While there’s little expectation of a hike this month, swaps traders are pricing in about even odds of a quarter-point increase in November.

  (Source: Bloomberg)

• Stakeholders are eager to strengthen relationships between Jamaica and Latin America. To facilitate this initiative, Adtelligent recently organized the "Keys to Latam" conference in Kingston, aiming to provide local and regional businesses with insights on cultivating these ties.
• CEO of Adtelligent Craig Powe says Jamaican businesses are set to benefit from a range of opportunities if they explore the Latin American market.
• He noted that CEO of Adtelligent Craig Powe says Jamaican businesses are set to benefit from a range of opportunities if they explore the Latin American market.
• Additionally, he noted that the region has a growing middle class that is driving demand for a variety of products and services. He added that the majority of business leaders in Latin American countries are 'Gen X' or millennials.
• As a testament to Jamaica's potential and success in the Latin American market, he pointed to Appleton Rum being the number two brand in Mexico at this time.
• Efforts to strengthen ties between Jamaica and Latin America, as seen with the recent "Keys to Latam" conference, hold significant potential for the Jamaican economy. The rising middle class in Latin America and their youthful business leadership offer lucrative opportunities for Jamaican sectors like trade, tourism, and manufacturing. Ultimately, this collaboration promises increased exports and investments, diversifying and bolstering Jamaica's economic landscape.

(Source: RJR NEWS)

• Tax Administration Jamaica (TAJ) is pleased to announce that four (4) of its Tax Offices have been ISO 9001:2015 certified by the National Certification Body of Jamaica (NCBJ).
• This certification means the revenue authority has acquired the seal of approval, for being in compliance with the internationally recognized standard for quality management systems. The Tax Authority, is one of 15 entities identified by the Ministry of Finance and the Public Service to undergo the World Bank funded certification activity
• Achieving this certification demanded rigorous commitment, including extensive staff training and a series of detailed audits at the certified locations. These audits ensured that TAJ's processes, documentation, and systems met or surpassed the exacting requirements of ISO certification.
• Additionally, TAJ was supported by the Ministry of Industry, Commerce, Agriculture and Fisheries (MICAF) through a lead consultant and supporting project staff, to guide the organization through the certification.
• The global, gold standard certification of the listed Tax Offices underscores Tax Administration Jamaica’s commitment to improving the customer service experience and quality standards, through documented reengineered business processes and procedures to meet the needs of the 21st century taxpayer, thereby making it easier to do business. He also indicated that this move will go a long way in strengthening the country’s economic programme, as doing business with the revenue services continues to improve and become easier.
• Tax Administration Jamaica continues to reengineer its business processes making it more convenient to do business, thereby improving compliance and ultimately resulting in a more tax compliant Jamaica.
• The ISO 9001:2015 certification secured by Tax Administration Jamaica signifies its commitment to operational excellence and enhanced user experience. This achievement will instill greater confidence among businesses and investors, leading to streamlined processes and a boost to the nation's economic environment.

  (Source: JIS News) 

• The Panama Canal's water levels have not recovered enough as the end of the rainy season approaches and limits on daily transit and vessel draft will stay in place for the rest of the year and throughout 2024, the waterway's authority said on Tuesday, September 5.
• The restrictions, implemented earlier this year to conserve water amid prolonged drought, triggered a backlog of ships waiting to pass the key global waterway, which handles an estimated 5% of world trade, contributing to more expensive freight costs ahead of the approaching Christmas season.
• The bottleneck at the canal connecting the Pacific and Atlantic Oceans has eased about 20% since last week, but waiting times to transit the waterway doubled last month from July in some vessel categories, while many ship owners have opted for alternate routes to avoid costly delivery delays.
• The authority that manages the canal added in a statement that this week's ship traffic represents a "normal" level for this season. It noted that a month before the end of its 2023 fiscal year, the canal's total vessel crossings already totalled nearly 800 more than what the canal authority's budget had forecast.
• The additional vessel crossings, which contribute to a total of more than 13,000 transits so far during the fiscal year, show strong demand by vessel owners. But insufficient rainfall continues to negatively impact Gatun Lake, which feeds the canal, lowering its water level to 24.2 meters (79.7 feet), versus 26.6 meters (87.41 feet) for September in recent years.
• Experts have warned about maritime trade disruptions ahead of what is shaping up to be an even drier period next year. They argue that a potential early start to Panama's dry season and hotter-than-average temperatures could increase evaporation and result in near-record low water levels by April.
• The enduring restrictions at the Panama Canal, one of the world's most strategic waterways, hint at broader implications for global commerce, potentially resulting in elevated costs and delivery times. For sectors heavily reliant on this route, such as retail and manufacturing, disruptions might translate to supply chain complications and inflated operational costs. Yet, alternate maritime routes and shipping solutions could gain traction, offering opportunities for regions and businesses positioned to leverage these alternatives. On a macro level, the Panama Canal's challenges underscore the broader economic and infrastructural impacts of climate change, emphasizing the urgency for sustainable solutions and adaptive measures in the global trade ecosystem.

(Source: Reuters)

• Credit projections within the financial sector are experiencing an approximate 16% increase, indicating significant activity in productive sectors despite the relatively low economic growth observed in the country in 2023.
• The rising trend in financing has led Rosanna Ruiz, the executive president of the Dominican Association of Multiple Banks (ABA), to suggest that the country might return to its potential economic growth range of 4.5% to 5.5% sooner than anticipated, spanning the remainder of the year and into 2024.
• Ruiz, in discussions with journalists specializing in economics, emphasized that the Central Bank’s estimates are on target. However, she highlighted credit behaviour as a key indicator reflecting the progress in various economic sectors, including MSMEs, construction, and real estate.
• Julio Lozano, Director of Economic Studies at ABA, discussed the behaviour of credits and mentioned that the Bank Credit Expectations Index (IEC) reached 55.1 in the second quarter of the year, indicating positive statistics for loan demand in the financial sector.
• Although economic activity grew by 2.9% year-on-year in July, with an accumulated growth of 1.4% in the first seven months, the government revised its growth outlook for 2023 downward. The revision lowered the projected growth rate from 4.25% to 3%, attributing the adjustment to economic uncertainty on both the international and local fronts.
• During discussions, Ruiz also emphasized the need for comprehensive tax reforms in the country, explaining that simpler and lower tax structures can help reduce tax evasion and encourage formal economic activity. She expressed the ABA’s opposition to a general rule proposed by the General Directorate of Internal Taxes (DGII), which designates certain entities as withholding and collection agents for various taxes, citing potential negative impacts on formality and incentives.

(Source: Dominican Today)

• The number of Americans seeking jobless benefits for the first time fell unexpectedly last week to the lowest level since February, pointing to a U.S. job market that remains relatively tight even as other recent data indicate it has begun to soften.
• Initial claims for state unemployment benefits fell 13,000 to 216,000 in the week ended Sept. 2 from a revised 229,000 in the prior week, the Labor Department said on Thursday. That was the lowest since the same level was touched in the week ended Feb. 11 and it marked the fourth straight weekly decline. Economists polled by Reuters had forecast new claims would rise to 234,000 in the latest week.
• Meanwhile, the rolls of those continuing to receive jobless benefits beyond the first week fell by 40,000 to 1.679 million in the week ended Aug. 26 from a revised 1.719 million a week earlier. That was the lowest since the same level was hit in the week ended July 15.
• Last week, the Labor Department said job growth picked up in August, although employment gains reported in the previous two months were revised sharply lower in an indication that labour market conditions were loosening. The unemployment rate rose unexpectedly to 3.8% from 3.5%, but that was driven by an increase in the labour force participation rate to the highest in more than three years.
• Nonfarm productivity - measuring hourly output per worker - increased at a 3.5% annualized rate in the period from April through June - the highest since the third quarter of 2020 - versus a -1.2% reading in the first three months of the year. Second-quarter productivity had initially been estimated at 3.7%.
• The report also showed labour costs, a key focus of the Federal Reserve as it battles to bring inflation back down to its 2% target, rose at a 2.2% annualized rate, a somewhat faster pace than the 1.6% rate initially reported. Nonetheless, the advance was still the slowest since the fourth quarter of 2022.

(Source: Reuters)