Latest News

Imbert: Economy will suffer if Petrotrin is prevented from moving forward Published: 09 October 2018

  • Finance Minister Colm Imbert has warned that Trinidad and Tobago’s economy will suffer “profound implications” if Petrotrin is prevented from moving forward with its restructuring plan.
  • He said just yesterday he received a letter from Petrotrin asking for financial support by giving Government guarantees for financial facilities to three banks to the tune of TT$1.2 billion and when he signs this it immediately pushes this country’s debt profile up.
  • Imbert said these financing facilities need to be refinanced on or before October 15.

Source: Trinidad Express

10-year Treasury yield hits fresh 7-year high as bond market reopens Published: 09 October 2018

  • The yield on the benchmark 10-year Treasury note rose above 3.25 % in early trading today, returning to levels not seen in more than seven years. 
  • Bond experts have pointed to the robust economic data, signs of inflation and a glut of debt issuance as a reason for the rising rates.

Source: CNBC

IMF Cuts Forecast for Global Growth as Trade War Takes Toll Published: 09 October 2018

  • The IMF cut its forecast for global growth to 3.7% for this year and next, down from 3.9% previously.
  • It blamed escalating trade tensions and stresses in emerging markets for the reduction.
  • The policy lender warned of a recession in Argentina and slower growth in Brazil, while calling for sweeping reforms to shield Turkey’s economy following the recent drop in the lira.
  • Pakistan, meanwhile, has said that it will seek the country’s 13th IMF bailout since the late 1980s

Source: Bloomberg

Barbados Sees External Debt Swap Offer Ready in Weeks or Months Published: 05 October 2018

(Bloomberg) Barbados expects a debt restructuring offer with external creditors to be ready "in a matter of weeks or months," special adviser to the Barbados government Avinash Persaud said [today] during a webcast with the IMF. 

  • Discussions with foreign creditors "more complicated and it takes longer" than local debt restructuring. "We believe there is a path toward an adjustment" with external debt: Persaud 
  • IMF’s deputy division chief Bert van Selm said he sees "orderly process with good faith discussions" with domestic and external creditors 
  • Domestic debt restructuring offer "strikes the right balance" for government and credit holders: Van Selm 
  • Public debt of 157% of GDP is unsustainable "by any standard" and restructuring debt stock very important: Van Selm 
  • Government targets debt-to-GDP of 60% and primary surplus of 6% of GDP, Persaud said 
  • The government wants to "move toward a world where we can remove our exchange controls," Persaud said
  • Reserves should be around $2Bn Barbados dollars before easing exchange controls. "We are not going to do it in any rushed or rash way," Persaud said

Oil prices rise on Iran sanctions, outlook uncertain Published: 05 October 2018

  • Oil prices steadied just below four-year highs on Friday as world fuel markets tightened ahead of a new round of U.S. sanctions on Iranian oil exports due to be imposed in November.
  • Benchmark Brent crude oil LCOc1 was down 5 cents a barrel at $84.53 by 1230 GMT. On Thursday, Brent fell by $1.34 a barrel or 1.6%, but the contract remained on course for a gain of around 2 %for the week.
  • US. light crude CLc1 was up 25 cents at $74.58, a gain of more than 1.5% since last Friday.
  • Speculators have accumulated bullish long positions, betting on a further rise in prices to $100 per barrel by next.

Source: Reuters

Job growth slumps in September, but unemployment rate hits lowest level since 1969 Published: 05 October 2018

  • US 10-year yield jumps to a fresh 7-year high after the unemployment rate falls to lowest in 49 years
  • Job creation for September falls to its lowest level in a year, but the unemployment rate drops to a level not seen since December 1969.
  • Closely-watched average hourly earnings rose 8 cents or 0.3% over the month, matching August's gain.
  • The yield on the benchmark 10-year Treasury note returns to levels not seen since May 2011 following the release. Yields were 3.233% immediately following the jobs report.

Source: CNBC

Margaritaville Turks Ltd (MTL) profits up despite hurricanes Published: 05 October 2018

  • For the year ended May 31, 2018, MTL reported profits of US1.1Mn (EPS: US¢1.6), representing a 114% over the $499 (EP: US¢0.7) reported last year. 
  • This came despite a decline of 7.9% in revenues to US$6.0Mn due to disruptions caused by hurricanes which hit Grand Turk in September of 2017.  Recovery was swift, allowing the company to re-open within 2 months.
  • The company also received insurance payments of US$646K which boosted its bottom line.
  • Sans risk of future natural disasters, the company remains optimistic given the negotiations underway which will see an expansion of the Grand Turk Port coupled with Carnival Corporation substantially increasing its ship size across all their cruise lines.

Source: MTL Audited Financials, NCBCM Research

Mystic Mountain to Ramp-up Capacity, Issues $1.1Bn Bond Published: 05 October 2018

  • Mystic Mountain recently raised $1.1Bn through a private placement intended to double the park’s capacity and refinance existing debt.   The bond carries a coupon of 7.125% and matures in 7 years.
  • The funds raised will among others be used to increase the park's capacity from approximately 200 persons per hour to 400 persons per hour as well as do upgrades to the parks existing facilities.  The former will be facilitated through the creation of new attractions, including roller glider, ropes and wall climbing attractions
  • Sygnus Capital was the arranger of the issue which received a rating of “adequate” with a stable outlook from CariCRIS. 

Source: FG

Brazil's Fiscal Outlook Will Remain Source Of Uncertainty Published: 03 October 2018

(Fitch Connect) Brazil's fiscal deficit will most likely narrow gradually over the coming years, although downside risks are significant. With the next Congress set to be dominated by centrist parties, the spending cap amendment will remain in place and modest fiscal reforms will likely be enacted. However, significant structural adjustments such as pension reforms will face major obstacles to enactment, which could trigger a significant deterioration of investor sentiment over the two years.

NAFTA 2.0 Leaves Preferential Trade Access Intact Published: 03 October 2018

( Fitch Connect) On September 30, the US and Canada reached an agreement on bilateral issues that will allow NAFTA 2.0 to move forward as a trilateral accord, following a similar agreement between the US and Mexico in August. The agreement will in large part alleviate uncertainty surrounding the future of trade relations within the bloc, and will now go to legislatures for approval.