By CentralBankNews.info
Trinidad and Tobago’s central bank left its benchmark repo rate at 5.0 percent, saying “while there remains room for macroeconomic policy support towards a durable economic recovery, the external balance has not yet been restored.”
The Central Bank of Trinidad and Tobago (CBTT), which has maintained its rate since raising it in June 2018, said its monetary policy committee had considered the shifting external conditions, especially trade and geopolitics, adding the interest rate gap between 3-month TT and U.S. Treasury securities had remained negative but narrowed to minus 51 basis points at the end of November.
Growth in private sector credit slowed to 4.3 percent year-on-year in September from 4.5 percent in July as the contraction in business credit deepened to 5.5 percent while consumer credit had grown 5.9 percent and real estate mortgage loan growth accelerated to 10.9 percent.
Production of natural gas, which accounts for around one-third of Trinidad and Tobago’s gross domestic product, rose an annual 3.7 percent in third quarter despite maintenance shutdowns at two large natural gas platforms, while crude oil output was just under 60,000 barrels per day in the first half of the year, down from a daily average of around 64,000 barrels in 2018, “a reflection of the ongoing maturation of the oil fields,” CBTT said.
Trinidad and Tobago’s GDP shrank 1.0 percent year-on-year in the first quarter of 2019, down from a 2.1 percent decline in the previous quarter while headline inflation slowed to 0.3 percent in the 12 months to November.
The Central Bank of Trinidad and Tobago made the following announcement on Dec. 27:
“Global growth softened towards the end of 2019, with the International Monetary Fund (IMF) lowering its annual projection to 3.0 per cent, 0.2 per cent below its mid-year estimate. Recent political developments in the United Kingdom and United States have added to policy uncertainty in these major countries, including on the trade front. Meanwhile, there has been a generalized move towards economic stimulus in many nations – the US Federal Reserve cut the Federal funds rate by 25 basis points in October 2019, the third reduction in six months, prompting monetary easing in several Latin American countries such as Brazil, Chile, Mexico and Peru. In Europe, some economies are also being encouraged to ramp up fiscal stimulus to support economic growth. In global energy markets, natural gas prices (Henry Hub) remained below US$3 per mmbtu and West Texas Intermediate (WTI) oil prices hovered around US$60 per barrel in December.
Domestically, in the third quarter of 2019 natural gas production increased to 3,604 million cubic feet per day (mmcf/d), 3.7 per cent above output in the same quarter of 2018, despite maintenance shutdowns at two large natural gas platforms. This spurred year-on-year increases in petrochemicals (23.3 per cent) and liquefied natural gas (8.0 per cent). At the same time, over the third quarter of 2019, crude oil production remained at its level of just under 60,000 barrels per day during the first half of the year, compared with a daily average of around 64,000 barrels in calendar 2018, a reflection of the ongoing maturation of the oil fields. In the non-energy sectors, preliminary data for indicators monitored by the Central Bank point to modest expansions in the distribution and finance sectors during the third quarter. An uptick in local sales of cement suggests that construction activity is responding to the rise in public sector infrastructural investments.