Macroeconomic Forecast Trinidad & Tobago

Consumer price inflation eased slightly in April, rising by 9.3% y-o-y (from 9.8% y-o-y in the previous month). The downturn could be a sign that the central bank's tightening efforts - which have included issuing a series of sterilisation bonds to absorb domestic liquidity - is having an effect. That said, we remain wary that the country still faces local capacity constraints and supply bottlenecks, which will continue to stoke latent price pressures, especially while agricultural prices stay high. As such, we stand by our end-2008 target of 8.8%.

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