• The Bank of England kept interest rates on hold on Thursday, wrong-footing investors who had been convinced that it would be the first of the world's big central banks to raise borrowing costs after the COVID-19 pandemic. 
• The BoE kept alive the prospect of a move soon, saying it would probably have to raise bank rate from its all-time low of 0.1% "over coming months" if the economy performed as expected. 
• But seven of its nine policymakers voted to leave rates unchanged for now - even as they forecast inflation would reach almost 5% in April - so they can see how many people lose their jobs after the recent end of the government's furlough scheme. 
• The announcement sent shockwaves through markets, sending sterling towards its biggest fall since the early days of the COVID-19 pandemic in March 2020.

(Source: Reuters)

• The Government is seeking to ensure that wide-ranging legislative and product provisions being targeted for implementation and delivery under the proposed Micro-insurance Bill redound to the benefit of all Jamaicans, especially the most vulnerable. 
• Micro-insurance looks to assist low-income persons by offering insurance plans tailored to their needs. Key among the provisions, is the fit and proper requirements for potential service providers, who have to be registered. The Minister of Finance said in addition to defining micro-insurance and specifying the relevant products to be offered, the legislation will require that these offerings have stipulated minimum terms and conditions and that all be administered under formal contractual arrangements. 
• Clarke maintained that this will be crucial to properly service the market where incomes are in a number of instances low and there are a lot of demands on income. The legislation will require that claims be resolved and paid out within five days, so that the experience of the insured is such that the micro-insurance is seen as one that adds value. 
• Work on the Bill’s development is currently advanced, and it is expected to be tabled in Parliament before the end of the 2021/22 fiscal year, on March 31, 2022. It is anticipated that the legislation will be passed during the 2022/23 fiscal year, which starts on April 1, 2022. 
• The development and implementation of a micro-insurance policy framework forms part of the Government’s thrust to broaden the base of the economy and deepen its inclusiveness by making insurance accessible to all Jamaicans.

(Source: JIS News)

• Deputy Mayor of Montego Bay, Councillor Richard Vernon, says Frontier Airlines’ inaugural flight from Atlanta, Georgia, to Sangster International Airport in Montego Bay, is a show of confidence in the country’s management of the coronavirus (COVID-19) pandemic. 
• Vernon said that increasing the number of flights into Montego Bay and Jamaica, by extension, sends the message that Jamaica is safe for travel. Mr. Vernon noted that new flights also mean new business for Montego Bay, particularly when the direct flight is coming out of Atlanta, which is the sister city that Jamaica has shared such a close relationship with for many years. 
• This new Frontier Airlines flight route opens the door for more support from the diaspora. Further, having nonstop flights mean persons can travel freely, and business can be transacted at a faster pace. 
• It also augurs well for recovery in the tourism industry and indicates that there is demand for travel to Jamaica. As at July 2021, there have been 716,221 tourist arrivals, which is below the 1.07Mn and 2.64Mn reported in 2020 and 2019, respectively. The Government is forecasting 1.57Mn visitors and more than US$2.0Bn in earnings for this year.

(Source: JIS News & NCBCM Research)

• The Government may be reaching its debt limits given that such liabilities are now bigger than the economy, the Debt Advisory Committee’s head warned yesterday. 
• James Smith, former minister of state for finance in the first Christie administration, told Tribune Business that The Bahamas’ current debt-to-GDP ratio of 100.4% is “not a comfortable place to be” as he prepares to advise the Government on how to manage and reduce its $10.356bn stockpile of liabilities. 
• “We might be reaching our ceiling when we have debt at the level of GDP. It’s not a comfortable place to be,” he conceded. “It’s the quantum of the debt and the tenor of the debt that we have to look at, and the way forward would be to manage the debt by setting some objectives, but we wouldn’t know that until we get the committee formed and get a fully comprehensive background on it.” 
• While the economy’s rebound will increase output and gross domestic product (GDP), thereby likely taking the debt ratio back below 100 percent, this will likely remain elevated in the high 80 percent to 90 percent-plus range for some time to come given the blow-out produced by Hurricane Dorian and COVID-19 that further accelerated The Bahamas’ fiscal deterioration.

(Source: The Tribune)

• Fitch Solutions has revised its 2021 real GDP growth forecast for El Salvador to 9.2%, from 5.1% previously, as economic activity has surprised to the upside in the year through August. In 2020, the economy contracted by 7.9%. 
• Substantial rebounds in private consumption, exports and investment will persist in the coming quarters, though fading base effects will undermine headline figures. 
• As a result, Fitch has revised down its 2022 real GDP forecast to 2.7%, from 3.0% previously, as the agency anticipates that the accelerated rebound in H121 has brought the expansion forward and growth will return to its pre-pandemic pace.

(Source: Fitch Solutions)

• The Federal Open Market Committee on Wednesday detailed plans to begin scaling back asset purchases later this month and said the bar to begin the liftoff in rates would be more "stringent." 
• The monthly bond purchases of $120 billion, $80 billion in Treasuries and $40 billion in mortgage-backed securities would be trimmed by $15 billion a month. 
• Under the taper plans, the Fed will reduce monthly Treasury purchases by $10 billion and mortgage-backed securities by $5 billion. Still, the Fed's balance sheet will continue to expand, but at a reduced pace.  
• The taper puts the Fed on track to end its bond-buying program by mid-2022, but Fed cautioned that the pace of bond-buying may change depending on incoming economic data.

(Source: Investing.com)

• October’s Purchasing Managers' Index surveys suggest that emerging market (EM) manufacturing activity picked up at the start of Q421. This marks a significant improvement, given weak activity data in recent months. 
• The big story in EMs remains inflation, which jumped in September. This spooked bond markets and prompted central banks in Brazil, Colombia, Russia, Poland and Argentina to hike their policy rates. Policymakers in Turkey, by contrast, continued to cut their key rate. 
• While Fitch Solutions maintains their view that inflation will ease next year, it expects that many EM central banks will continue to tighten policy.

(Source: Fitch Solutions)

• Supreme Ventures Limited reported a marginal decline in net profit of 0.7% to $1.54Bn (EPS: $0.58) for the nine months ending September 30, 2021. This came on the back of a rise in selling and administration expenses, which outstripped the rise in total gaming income. 
• Gaming income for the period grew 13.5% (or $3.77Bn), driven by the lotteries segment. The sports betting segment also saw year on year growth given the attractiveness and flexibility of participating in gaming activities, enhanced with the use of mobile platforms and the support of the ecommerce platform. 
• The Group continues to focus on expanding channels and terminals, which have been well received by the marketplace. SV Games (Mobile/Online) has seen exponential growth in both usage and the number of active online users, due to the increased number of games that can be played on the platform, as well as strong promotional and product enhancement activities. The expansion of the Supa Sellaz program has provided an additional sales channel for both the company’s customers and third-party retailers. 
• However, the impact of strong topline growth was eroded by a 23.0% rise in selling, general and admin expenses, which may have been as a result of SVL’s strong promotional activities. 
• New products will be launched through the retail channel as the company provides continuous opportunities to grow with its retail partners. SVL’s Guyana market is showing steady growth. Furthermore, management noted that, the improvements in the horse racing product and operations using technology and new product solutions promise to create a profitable, sustainable business for the first time in the history of Caymanas Park. These opportunities will in turn support an improvement in the company’s bottom-line, especially as economic activity in its operating territories recover. 
• SVL’s stock price has appreciated by 0.95% since the start of the year and closed Tuesday’s trading session at a price of $17.78 per share. At this price the stock trades at a P/E multiple of 19.9x.

(Source: SVL Financials & NCBCM Research)

• The Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, says recovery from the ravages of the coronavirus (COVID-19) pandemic is gathering pace, as evidenced by the recent positive economic indicators. 
• He cited, among other things, the 14.2% growth for April to June 2021, and the 93,400 increase in the number of persons in jobs in July. Dr. Clarke said that the growth out-turn for the June 2021 quarter came in way above what anybody would have forecasted, thought or expected. He noted that while it does not recover all the lost output owing to the pandemic, it substantially advances the likelihood of that. 
• Clarke said that the best part about the recovery is that the jobs are returning, describing this development as a big deal. Noting that Jamaica lost approximately 100,000 jobs over four years following the 2008/09 global financial crisis, he said it took us 10 years to get those jobs back. 
• The Minister noted that approximately 150,000 jobs had been lost in the pandemic over four months in 2020, and in 12 months just under 100,000 of those have been brought back, which is surely a sign that the economic recovery is gathering pace. He added that Jamaica is among the leaders in the Caribbean region, as far as the strength, pace and momentum of its economic recovery is concerned. While acknowledging that Jamaica had not yet returned to pre-COVID economic performance, he maintained that there is reason for cautious optimism going forward. 
• Clarke has said that notwithstanding the challenges Jamaica has had with vaccine hesitancy and vaccine supply, economic recovery in Jamaica is under way. He pointed out that leading international agency, S&P Global Ratings, upgraded its outlook for Jamaica from ‘Negative’ to ‘Stable’, in the midst of the pandemic, with a low vaccination rate. The Minister added that today, Jamaica has a credit rating that is effectively unchanged from its pre-pandemic credit rating. Dr. Clarke maintained that the recovery is showing up where it matters most, and that is with people having an income in their pockets, once again, in exchange for the work that they put out.

(Source: JIS News)

• As Guyana moves ahead with the development of its petroleum industry, Vice-President Bharrat Jagdeo said that oil blocks, which remain untouched in some cases, would be up for auction by the third quarter of 2022. 
• Speaking during a press conference at the Arthur Chung Conference Centre on Monday, Vice-President Jagdeo said the government intends to move first towards the enforcement of relinquishment provisions in all oil contracts before auctioning new blocks. 
• Simply put, relinquishment provisions are enforced when a party might no longer be able to deliver on a contract. By adopting an approach which involves the enforcement of relinquishment provisions, authorities would be able to have not just virgin blocks but also relinquished areas for the impending auction.

(Source: CariCRIS)