• Regional rating agency, CariCRIS, has upgraded Barbados’ regional scale local currency rating to “ CariBB” with stable outlook, up from “Cari D”. CariCRIS has also maintained its Regional Scale Foreign Currency rating of CariD (Default) on the country’s foreign currency denominated debt.

• The rating agency said its decision to upgrade the rating on the local currency debt was driven by the closure of the exchange offer for domestic debt. The restructured debt is estimated to potentially save $500 million in interest per year.

• Upon successful completion of negotiations with foreign debt holders, CariCris said it will similarly revise its ratings on the country’s foreign currency debt Government is expected to complete the external debt restructuring by the end of March.

• As at October last year, Barbados debt to GDP stood at just over 124% (down from 170% last May), making it one of the highest in the Caribbean.  The rating agency projects that Barbados will grow by 1% this year.

(Source: Barbados Today)

• According to Fitch, the Banco Central de la República Dominicana (BCRD) will likely hike its benchmark interest rate in 2019 in order to partly preserve its interest rate differential with the US and minimize pressure on the Dominican peso.

• Historically low inflation and robust capital inflows will allow the bank to enact fewer hikes than the US Fed, and grant it flexibility if real GDP growth slows more than anticipated in 2019.

• Fitch forecasts that the BCRD will hike its benchmark interest rate by 25 basis points (bps), to 5.75%, by end-2019.  

(Source: Fitch)

• There is general pessimism among market participants in the U.S. over where the market is heading amid rising interest rates from the U.S. Federal Reserve and geopolitical tensions, especially between the U.S. and China.

• A survey of 500 Wall Street wealth managers by Natixis in December showed that the majority felt that the longest bull market in history will come to an end in 2019.

• The Fed is expected to raise interest rates twice in 2019.

(Source: CNBC

• Oil prices rose on Tuesday amid supply cuts by producer club OPEC and Russia, although a darkening economic outlook may soon weigh on growth in fuel demand. Brent crude oil futures LCOc1 were at $59.47 per barrel at 0950 GMT, up 48 cents, or 0.81 percent, from their last close.

• S. West Texas Intermediate (WTI) crude futures CLc1 were at $50.92 per barrel, also up 0.81 percent, or 41 cents.  “OPEC-led cuts and declining U.S. rig counts have bolstered market sentiment in the new year,” Singapore-based brokerage Phillip Futures said.

• On the demand side, an economic slowdown continues to loom over oil and financial markets. The gains in crude futures on Tuesday came after losses of more than 2 percent the previous session as weak Chinese trade data pointed to a global economic slowdown. HSBC said it was cutting its average 2019 Brent price forecast by $16 per barrel, to $64 per barrel, citing surging U.S. production and an “increasingly uncertain demand backdrop”.

(Source: Reuters)

• For the year ended October 31, 2018, Indies Pharma reported a net profit of $119.7Mn (EPS: $0.9), which represents a 15% decline from the $140.2Mn (EPS: $0.12) reported in 2017.
• The contraction in profit occurred despite revenues increasing 3%, from $620.3Mn in 2017 to $636.1Mn in 2018.
• The outcome can be attributed to a 17% increase in direct expenses, which moved from $208.7Mn in 2017 to $243.3Mn in 2018.
• The stock has grown by 119% (from $1.50 to $3.28) since it listed last August and currently trades at P/E of 37x earnings, which is above the junior marker average of 27x.

(Source: JSE, INDIES Financials)

• The Government on Tuesday (January 8) tabled the Second Supplementary Estimates, which show that the Administration is proposing to spend an additional $11.4 billion for this fiscal year.

• The Estimates reveal that the budget has been increased from $791.11 billion to $802.56 billion.

• Recurrent (housekeeping) expenses have moved from $572.46 billion to $582.5 billion, for an additional expenditure of $9.65 billion.

• In terms of capital (development) spending, this is proposed to be increased by $1.36 billion, moving from $218.64 billion to $220.04 billion.

(Source:  JIS)

• According to Fitch, Guyana will likely see a general election in Q119 after a successful no-confidence vote against the ruling A Partnership For National Unity (APNU) government in December 2018.
• The 33-32 margin of the no-confidence vote will heighten political uncertainty in the coming weeks, as APNU has already challenged the vote.
• The expectation is that the opposition People's Progressive Party (PPP) will be slight favorites if an early election takes place. 

(Source: Fitch)

• The Barbadian economy is expected to crawl dead last among Caribbean economies this year, shrinking by a disappointing -0.5%  last year, the second lowest growth rate region-wide, according to the United Nations economic watchdog for the area.

• Barbados is expected to have the lowest growth of just 0.5% in 2019, said the latest report from the Economic Commission for Latin America and the Caribbean (ECLAC).

• When lined up against the other 32 nations in Latin America, South America, and the Caribbean, Barbados’ decline of -0.5% for this year places it as the economy with the fifth lowest growth rate.

• Growth this year is expected to be led by Antigua and Barbuda at 5.3%; Grenada, 5.2%; Guyana, 3.4%; and St Vincent and the Grenadines at 3.2%, it said

(Source: Barbados Today)

• Federal Reserve Chair Jerome Powell said policymakers are “going to be patient and watching, and waiting and seeing” before adjusting interest rates again.
• Still, the bank is intent on cashing in on maturing debt rather than re-investing it to attain a “substantially smaller” balance sheet, he said.
• Analysts now see the once widely expected March rate hike as off the table with numerous Fed speakers increasing their dovish tones.

(Source: Bloomberg)

• According to Fitch, the Colombian peso (COP) is expected to appreciate modestly in the coming months as oil prices trend higher and real GDP growth picks up.
• Over the longer term, the peso will likely trade sideways as higher energy prices and a narrowing real interest rate differential with the US offset one another.
• Fitch has revised their 2019 average forecast to COP3,172.9/USD, from COP3,010.9/USD previously. 

(Source: Fitch