Down town Port of Spain, Trinidad.
The Trinidad and Tobago economy remains growth-challenged, but early signs of improvement have appeared in the energy sector as exploration activity picked up in the third quarter.
Output of natural gas is expected to rise with the coming on-stream of the Juniper project, the Central Bank of Trinidad and Tobago stated recently, flowing from their decision to hold the bank’s repo rate at its current level of 4.75 percent.
The report goes on to state that “growth in energy and energy-related production is expected to eventually spur activity in other (non-energy) sectors that are still subdued.” “Available indicators on construction and distribution point to continued sluggishness in these areas. However, official statistics suggest that the unemployment rate has remained relatively steady at just under 4 percent on average in 2016.”
The rate of increase in general prices in Trinidad and Tobago remained low. Data from the Central Statistical Office point to headline inflation of 1.4 percent in July 2017 (12-month basis), with core inflation, which excludes food prices, also at 1.4 percent. The average for both these measures over the year to July was 2.2 percent and 2.1 percent respectively. Food inflation measured 1.4 percent in July 2017 compared to 0.5 percent in June.
The central bank reported that “Interest rates in the banking system have remained virtually unchanged for the year so far. The strongest loan categories in July were for consumers (4.1 percent growth year-on year), including the sub components for real estate mortgages (5.0 percent) and credit cards (8.3 percent), while credit to businesses increased by just 0.3 percent.”
“Liquidity in the commercial banking system remained steady in the third quarter of 2017 with banks’ excess reserves at the Central Bank averaging around $2.8 to $3 billion. There was a small increase in the TT-US interest rate differential on 3-month Treasuries from 14 to 16 basis points between July and mid-September 2017.”
