Budget Expectations and Energy Progress Support T&T's Market Outlook

Budget Expectations and Energy Progress Support Trinidad & Tobago’s Market Outlook

October 2 2026

Dave Dookie, CEO

• Trinidad & Tobago’s October 12 Budget takes center stage, with investors focused on the Government’s fiscal plans, borrowing strategy, infrastructure spending and measures to encourage economic growth.

• Energy-sector developments provide a positive backdrop, including progress on Coconut, Aphrodite, Manakin-Cocuina, Manatee and Calypso, alongside renewed deepwater investment. NGC also reported TT$3.46 billion in 2025 after-tax profit.

• Global markets were mixed as interest rates remained elevated. The S&P 500 slipped 0.25% over five days, while the Nasdaq gained 0.45%. European and UK markets were generally weaker, while Japan's Nikkei gained 2.93%. The U.S. 10-year Treasury yield moved above 5.3% during the week.

• Trinidad & Tobago equities recorded modest gains, with the Composite Index rising 0.19% and the All T&T Index gaining 0.16%. Trading activity remained relatively light, while banking system excess liquidity declined to approximately TT$3.96 billion.

• Caribbean USD bond yields moved higher with global rates. T&T's 2036 and 2038 sovereign bonds offered yields around 6.95% and 7.04%, Jamaica's 2036 around 5.84%, Barbados' 2035 around 7.24%, and the Dominican Republic's 2036 around 7.02%. NGC's 2036 bond was offered around 92.00, yielding approximately 7.25%.

Attention in Trinidad and Tobago is increasingly turning to the 2026/2027 National Budget, scheduled for October 12, with investors looking for greater clarity on the Government’s fiscal priorities, borrowing programme and plans to support economic growth. The Budget comes at an important time, that is when international interest rates remain elevated, with the U.S. 10-year Treasury recently moving above 5%, while domestic liquidity has tightened. Against this backdrop, markets will be particularly attentive to the fiscal deficit, debt-management strategy, infrastructure spending and measures aimed at encouraging private investment. The Government has indicated that the Budget will outline its economic programme and provide an update on developments across key sectors.

The energy sector offers a more constructive backdrop ahead of the Budget. Recent developments include NGC’s new gas supply contract with EOG Resources and its agreement to receive 50% of the gas volumes from the Coconut development, which is expected to begin production in early 2027. NGC and Shell have also advanced the Aphrodite development, while work continues on the Manakin-Cocuina and Shell’s Manatee project. In deepwater exploration, BP is moving to acquire Woodside’s 70% interest in Calypso, and Occidental has joined ExxonMobil in the TTUD-1 ultra-deepwater block. Although these projects will take time to reach production, together they signal improved prospects for natural gas supply, LNG and petrochemical activity, government revenue, and foreign-exchange earnings. NGC also reported TT$3.46 billion in after-tax profit for 2025, its highest in more than a decade.

Global Markets: Higher Yields Remain the Key Theme

U.S. equities were mixed over the last five trading days. The S&P 500 slipped 0.25%, while the Nasdaq gained 0.45% and the Dow declined 1.26%. Technology remained relatively resilient, with Nvidia gaining 3.95% and Broadcom 1.02% over five days. The more significant development, however, was the bond market, we observed the U.S. 10-year Treasury yield climbed above 5.3% during the week, its highest level since 2002, as investors responded to persistent inflation and expectations that rates could remain higher for longer. Brent crude also remained above US$100 per barrel, providing support for energy producing economies but adding to global inflation concerns.

The UK and European markets have weakened. The FTSE 100 declined 2.18% and the FTSE 250 slipped 0.28%. Continental Europe was also softer, with the STOXX Europe 600 down 1.14%, Euro Stoxx 50 declining 1.02%, CAC 40 falling 2.24%, DAX losing 0.70% and Italy’s FTSE MIB down 2.67%. Higher bond yields remain an important constraint for European valuations, with UK long-term yields reaching 6% during the week.

Asia produced a mixed picture. Japan’s Nikkei gained 2.93%, supported by continued strength in Japanese equities, while the JPX Nikkei 400 declined 0.81%. Chinese markets were weaker, with the Shanghai Composite falling 2.78% and Hong Kong’s Hang Seng declining 2.19%. Australia’s ASX 200 edged 0.20% higher.

Trinidad & Tobago Equities and Liquidity

The local market recorded modest gains. The Composite Index rose 0.19%, the All T&T Index gained 0.16%, and the Cross Listed Index increased 0.27%. Unilever Caribbean led the week's advances, rising 5.20%, followed by Trinidad Cement at 4.71%. Trading activity, however, was relatively subdued, the First Tier volume declined 87.66% to 1.51 million shares, with TT$15.30 million traded. NGL represented 37.64% of total volume.

Domestic banking liquidity also declined, with commercial-bank excess reserves falling by approximately TT$1.97 billion to TT$3.96 billion.

Caribbean Bonds

Caribbean USD bonds generally reflected the broader rise in global yields. Trinidad & Tobago’s 2030 bond was offered around 94.20, yielding approximately 6.26%, while the 2036 and 2038 issues offered yields around 6.95% and 7.04%, respectively.

Jamaica’s 2036 bond remained well above par at an indicative offer price of 119.00, yielding approximately 5.84%, while the 2039 and 2045 bonds yielded around 6.42% and 6.80%. Barbados’ 2029 was around 100.35 on the offer, yielding 6.28%, while its 2035 bond was around 103.80 with a 7.24% yield. In the Dominican Republic, the 2030 bond was offered near 94.05 at 6.51%.

In the energy sector NGC 6.05% 2036 Global bond was quoted around 90.00 bid/92.00 offer, with an indicative offer yield of approximately 7.25%. While higher global rates have placed pressure on Caribbean bond prices, Trinidad and Tobago enters the upcoming Budget period with a more encouraging energy sector pipeline. The key issue for investors will be how fiscal policy, energy investment and debt management come together to support sustainable growth while navigating a higher global interest-rate environment.

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