• United States (U.S.) consumer confidence eased in May as worries about inflation linked to the war in Iran intensified and households' views of the labour market were largely pessimistic, though they anticipated an improvement by the end of this year. The marginal drop in confidence reported by the Conference Board on Tuesday, May 26, 2026, contrasted starkly with the release last week of the University of Michigan's Surveys of Consumers, which showed consumer sentiment ‌plumbing record lows in May.
• Still, it was the latest sign of growing dissatisfaction with President Donald Trump's handling of the economy. Trump won the 2024 presidential election in large part because of his promise to lower inflation, but U.S. consumers have faced higher prices, first from his sweeping import tariffs and recently from the U.S.-backed war with Iran. A Reuters/Ipsos survey last week showed Trump's presidential approval rating fell to nearly its lowest level since he returned to the White House in January 2025.
• The darkening mood poses a challenge for Trump's Republican Party as it seeks to retain control of the U.S. Congress in the midterm elections in November. The ⁠Conference Board said its consumer confidence index slipped to 93.1 this month from an upwardly revised 93.8 in April. Economists polled by Reuters had forecast the index would drop to 92.0 from the previously reported 92.8 in April. The labour market has a big influence on the index, while the University of Michigan survey is more sensitive to gasoline prices.
• The decline in confidence occurred among consumers under the age of 35 as well as those 55 years and older. Consumers in the 35-54 age group were slightly more optimistic this month. Households with annual incomes ranging from $15,000 to $39,999 experienced a sharp decline in confidence. Of note, lower-income households have been disproportionately impacted by gasoline prices, which have risen more than 50% since the war in late February.

• Confidence was higher among consumers with annual incomes above $100,000, likely reflecting the rise in net worth due to a stock market rally. Though the ‌correlation between confidence ⁠and consumer spending is weak, economists cautioned that rising gasoline prices could pull spending from other goods and services. Higher inflation is also expected to curb demand. Finally, the Conference Board noted that consumers' write-in responses on factors affecting the economy continued to skew toward pessimism.

(Source: Reuters)

• Britain on Tuesday, May 26, 2026, targeted Russia-linked cryptocurrency platforms, banks and financial networks ‌that it said were used to bypass sanctions, freezing their assets and barring United Kingdom (U.K.) firms from processing payments and holding correspondent banking ties.
• The measures focus on what London described as "shadow financial systems" underpinning Russia's war economy, including the Kremlin-backed A7 network, which it said had been used to route funds, finance procurement, and exploit foreign banking systems to evade restrictions.
• The package also targets crypto exchanges and entities operating Russia-focused platforms, including a ⁠Kyrgyz bank and multiple firms registered in jurisdictions including Georgia and the United Arab Emirates, alongside individuals tied to the network.
• Britain said it was "tracking down and shutting off" payment routes fuelling Moscow's invasion of Ukraine. In a statement, the Russian embassy in London said the anti-Russian sanctions were unlawful and futile. "Russia has long since adapted to external pressure and will not alter its course on account of London’s whims," the Russian embassy added. "The consequences of these multiplying restrictions will primarily affect the citizens, businesses, and reputation of the United Kingdom itself."
• "We will continue to act fast and decisively, alongside our allies, to expose, disrupt and dismantle these networks, and ensure those ‌enabling Russia's ⁠aggression face consequences," foreign minister Yvette Cooper said in a statement.
• The move comes nearly a week after Britain said it would defer a ban on imports of diesel and jet fuel derived ⁠from Russian crude refined in third countries to ease supply pressures, a decision it said was a phased approach rather than any easing of sanctions.

(Source: Reuters)

• A Bill to facilitate the withdrawal of $11.4Bn annually from the National Housing Trust (NHT), to provide budgetary support for the Government over the next five years, was passed in the House of Representatives on May 19. The National Housing Trust (Amendment) (Special Provisions) Act 2026 was piloted by Minister of Finance and the Public Service, Hon. Fayval Williams.
• In her remarks, Mrs. Williams noted that in 2013, under the Extended Fund Facility with the International Monetary Fund (IMF), the Government of the day obtained contributions towards fiscal consolidation from the NHT for $11.4Bn. She noted that this was achieved by way of an amendment to the National Housing Trust Act, the provisions of which came to an end in March 2017.
• She added that given the need for further budgetary support for the Government’s economic programme, a further amendment of the NHT Act was undertaken in August 2017 to facilitate the continuation of annual transfers from the NHT for the fiscal years 2017/2018 to 2020/2021, and again in December 2020 to facilitate a further continuation of annual transfers for the fiscal years 2021/2022 to 2025/2026. Mrs. Williams stated that 2025 was an unprecedented year for the country, with the passage and impact of Hurricane Melissa on October 28, 2025.
• She further noted that the NHT continues to maintain a strong asset position, with assets exceeding liabilities by approximately 1.8 times over the medium term. It is expected that the NHT will be able to continue to operate profitably while seeking to expand access to housing.
• While the Government opted to continue this revenue measure, the rationale is that the discontinuation of this measure during the current economic climate, which has been significantly altered by the passage of Hurricane Melissa, would result in a significant falloff in government revenues

(Source: JIS)

• Jamaica has received the second disbursement of funds from the European Union (EU) to support the implementation of the Digital Transitioning Programme for Jamaica (Digital Jamaica). This latest handover brings total disbursements under the Programme to J$613.5Mn(€3.41Mn), to date.
• The Programme supports the implementation of Jamaica’s National Information and Communications Technology (ICT) Policy and aims to expand inclusive access to and use of ICT, in pursuit of the country’s goal of becoming a digital economy and society.
• The financing agreement was finalised on July 25, 2023, for implementation over 48 months, totalling J$1.7Bn(€9.5Mn). It is being executed under the budget support modality and comprises three fixed tranches and three variable tranches. Speaking during a Handover Ceremony at the Ministry of Finance and the Public Service in Kingston on Thursday (May 21), State Minister Hon. Zavia Mayne emphasised that digital transformation is vital to national competitiveness, economic resilience, and social inclusion.
• Mr. Mayne outlined that the Programme comprises three components, focusing on ICT connectivity, digital skills in education, and the digital transformation of micro, small, and medium-sized enterprises (MSMEs).
• He further noted that the final component supports the digital transformation of MSMEs through the Jamaica Business Development Corporation (JBDC) and its network of small business development centres. “MSMEs will receive support and training to improve digitisation, digitalisation and the adoption of new technologies. This is essentially important for improving productivity, innovation and business competitiveness,” Mr. Mayne stated
• He emphasised that, collectively, the Programme will enhance broadband connectivity, strengthen digital learning, build digital competencies among educators, and support greater technology adoption by Jamaican businesses, while creating meaningful opportunities for citizens to participate in the digital economy.
• The Digital Jamaica Programme supports the implementation of the National ICT Policy across the Ministry of Education, Skills, Youth and Information; the Ministry of Industry, Investment and Commerce; and the Ministry of Energy, Transport and Telecommunications.

(Source: JIS)

• Guyana is seen as a more attractive oil investment destination as Venezuela works through a sovereign debt restructuring process that analysts say could take years to complete, according to an S&P Global analysis published on May 20. 
• The report examined Venezuela’s plans to restructure sovereign debt and obligations tied to state oil company Petróleos de Venezuela, S.A. (PDVSA), and how they could gradually improve investor confidence in the country’s oil sector, despite ongoing challenges. 
• Analysts noted that Venezuela remains among the world’s highest-risk oil and gas investment jurisdictions, with Texas-based energy attorney Ted Borrego saying major international operators may continue favouring more stable opportunities such as Guyana.  “The big guys? There are so many other places that they can make money that going back to Venezuela is going to be a real stretch… There are a lot of places in Latin America that are much more attractive, e.g., Guyana, just next door, or in the rest of the world that don’t have the problems inherent in Venezuela,” Borrego said. 
• John Haley, a partner at Nelson Mullins law firm, said the process of restoring investor confidence and restructuring debt will likely happen at the same time rather than sequentially. “Can everything be repaid before operators go back in? It’s just not feasible… So, I think it’s something that needs to be done on parallel tracks,” Haley said. 
• However, Philip Luck, director of the economics program at the Centre for Strategic and International Studies, said debt restructuring alone will not be enough to unlock large-scale investment. “Venezuela still faces significant challenges in its physical infrastructure, human capital, and the governance of both the oil industry and the country at large. The sovereign’s liabilities are likely close to 200.0% of GDP. Past precedent puts the average time that restructurings of similar scale take at around 30 months,” Luck said.
• According to S&P Global Ratings analysts, Venezuela’s external debt burden is estimated at between US$150.0Bn and US$200.0Bn.
• The analysis noted that Venezuela’s oil production averaged 1.13 million barrels per day (b/d) in April, up 4.8% from March. PDVSA is targeting an output of 1.37 million b/d by the end of 2026 while updating production participation contracts under a revised hydrocarbons law. 
• In contrast, Guyana has emerged as a more stable and predictable oil investment destination, with offshore developments advancing under stable fiscal terms and without the debt, sanctions, and governance challenges facing Venezuela. 

(Sources: OILNow & S&P Global)

• Costa Rica is bracing for an extended El Niño event that meteorologists now expect to grip the country from June through the second half of 2026 and persist into the early months of 2027, prompting authorities to activate a national contingency plan covering water supply, electricity, agriculture and wildfire risk.
• The Instituto Meteorológico Nacional (IMN) has escalated its El Niño classification from “surveillance” to “advisory,” meaning forecasters now consider the development of the phenomenon highly likely rather than possible. The updated outlook is notably more severe than projections released as recently as April. The IMN now estimates rainfall deficits of up to 50 percent in some regions and temperatures running as much as 2 degrees Celsius above normal, compared with earlier estimates of 10.0% to 30.0% rainfall reduction and warming of 0.5 to 1 degree.
• “Those deficit conditions are now expected to be worse than they were a month ago,” Karina Hernández, head of the IMN’s Climatology Unit and director of the country’s ENOS Phenomenon Consultative Commission, said. She added that under the current outlook, “we would be under the effect of that El Niño throughout the second half of 2026 and possibly extending into the beginning of 2027.”
• The IMN forecast aligns well with the latest from the United States National Oceanic and Atmospheric Administration (NOAA), which puts the probability of El Niño persisting through February 2027 at 96.0%. The North American Multi-Model Ensemble favours El Niño developing within the coming month and continuing through the Northern Hemisphere winter of 2026 to 2027.
• The economic implications are already on the central bank’s radar. Banco Central de Costa Rica President Róger Madrigal López has indicated the country should expect an inflationary shock in early 2027 driven by El Niño’s impact on agricultural output and food prices. Reduced precipitation typically squeezes domestic production of staple goods, drives up the cost of livestock feed, and pressures the basic consumer basket.

(Source: Tico Times)

• The United States (U.S) said it launched new strikes on southern Iran on Monday, May 25, 2026, targeting Iranian missile sites and boats attempting to place mines. The strikes were in "self-defence" and designed "to protect our troops from threats posed by Iranian forces", U.S. Central Command (CENTCOM) said in a statement.
• Iran's Islamic Revolutionary Guard Corps (IRGC) said on Tuesday, May 26th, it had downed a U.S. drone and fired at a fighter jet and another drone that entered Iranian airspace, state media reported. It did not specify when this happened. It added that Iran had the "legitimate and definite" right to retaliate against any U.S. ceasefire violations.
• "U.S. forces conducted self-defence strikes in southern Iran today to protect our troops from threats posed by Iranian forces," CENTCOM spokesperson Captain Tim Hawkins said in a statement on Monday. "U.S. Central Command continues to defend our forces while using restraint during the ongoing ceasefire." Captain Hawkins added that the U.S. strikes targeted an area near Bandar Abbas, a southern port city and home of an Iranian naval base that sits on the Strait of Hormuz, according to the New York Times. Iranian state media had earlier reported that local officials in Bandar Abbas were investigating after explosions were heard.
• It is unclear what impact the latest U.S. strikes will have on any potential peace agreement between the U.S. and Iran. Following the U.S. attack, Secretary of State Marco Rubio said a deal was still possible and pointed to talks on Tuesday between Iran's top negotiator and foreign minister and Qatar's prime minister.
• "We'll see if we can make progress. I think it's a lot of talking back and forth going on about specific language in the initial document, so it'll take a few days," Rubio told reporters during an official visit to India. He said President Donald Trump had "expressed his desire to make it". "He's either going to make a good deal or no deal," Rubio said.
• Asked again later about Monday's strikes, Rubio said: "The straits have to be open. "They're going to be open one way or the other, so they need to be open. "What's happening there is unlawful, it's illegal, it's unsustainable for the world, it's unacceptable."

(Source: BBC)

• British shop price inflation sped up in May on the back of disruption and higher energy costs caused by the Iran ‌war, according to a retail industry group, which said the government had to do more to keep costs down.
• The British Retail Consortium's (BRC’s) monthly survey of major chains published on Tuesday, May 206, 2026, showed that ⁠prices in May were 1.2% higher than a year earlier, up from a 1.0% rise in April. Furniture and health and beauty products rose the most, reflecting rising raw material and shipping costs. However, food price inflation slowed to 2.7%, its lowest in a year, from 3.1%.
• BRC Chief Executive Helen Dickinson said the government, which ‌has ⁠pressed supermarkets to slow price increases and flirted with the idea of demanding price caps this month, had to play its part in bringing down costs for retailers. "Reducing ⁠the non-commodity charges, taxes and levies that make up more than two-thirds of energy bills, and cutting red tape would ⁠help keep inflation down," Dickinson said.
• Britain's broader official consumer price inflation index fell to 2.8% in April but ⁠is expected to rise again to around 4% in the coming months due to the energy price shock.

(Source: Reuters)

• On May 18, 2026, the World Bank (International Bank for Reconstruction and Development, or IBRD) priced a catastrophe (cat) bond that finances US$200.0Mn of hurricane insurance coverage for Jamaica, replacing the previous US$150.0Mn in cat bond coverage that was paid out to Jamaica following Hurricane Melissa in October 2025. The transaction was oversubscribed, allowing the World Bank to upsize the issuance from its initial target.
• The bond was issued under IBRD's "capital at risk" notes program (CAR 137), which enables member countries to transfer disaster-related risk to global capital markets. Under the transaction, the World Bank issues the notes and enters into a risk transfer agreement with the Government of Jamaica, which pays a premium based on the terms achieved in capital markets. The covered peril is a Named Storm, with a per-occurrence parametric trigger¹.
• The cat bond forms part of Jamaica's multi-layered disaster risk financing strategy, complementing budget reserves, contingent financing, and conventional insurance. The instrument is designed to absorb the fiscal impact of low-frequency, high-impact hurricane events, ensuring timely access to liquidity following extreme weather.
• Key terms include a settlement date of May 26, 2026 and a scheduled maturity of May 23, 2030. The issue price was at par, with the coupon set at Compounded SOFR plus a Funding Margin of 0.12% and a Risk Margin of 6.75% per annum.
• Investor distribution skewed heavily toward dedicated insurance-linked securities (ILS) capital, taking 69% of the issuance, asset managers 25%, and insurers/reinsurers 6%. Geographically, allocation was led by Europe (42%) and North America (41%), with Bermuda accounting for 16% and Asia/Australia 1%. The composition reflects the deep institutional pool that has developed around parametric sovereign cat bonds.
• By pre-funding up to US$200.0Mn of hurricane risk through capital markets, it preserves Jamaica's fiscal headroom (budget reserves, contingent credit lines, IMF/multilateral facilities) to respond to El Niño-related shocks, should they materialise alongside or independently of the 2026 Atlantic hurricane season.
• Following Hurricane Melissa, CAT bonds proved their worth, providing a rapid, transparent infusion of cash that bypassed the lengthy claims adjustment process typical of standard insurance. Because the bond utilised a parametric trigger, the US$150.0Mn payout was triggered automatically and disbursed within weeks of the storm.

_______________________

¹Bases the payout on objective physical data like central pressure and track location rather than a subjective assessment of damage.

(Sources: World Bank, Relief Web & NCBCM Research)

• On May 20, 2026, the Planning Institute of Jamaica (PIOJ) released preliminary estimates showing real GDP contracted by 5.9% in the January–March 2026 quarter relative to the same period in 2025. The decline was broad-based, with the Goods Producing Industry down 11.2% and the Services Industry down 4.1%, reflecting the lingering disruption from Hurricane Melissa and the early onset of cost pressures linked to the Middle East conflict.
• Within the Goods Producing industry, Mining & Quarrying recorded the steepest decline at -26.6%, followed by Agriculture, Forestry & Fishing at -20.3%, Manufacturing at -7.7%, and Construction at -1.3%. The Mining contraction extends the -37.5% drop posted in Oct–Dec 2025, reflecting continued disruption to alumina and bauxite production in the wake of the hurricane. Declines in Agricultural output were sharpest in the western parishes, with St Elizabeth (39.9%) and Hanover (38.1%) bearing the brunt of post-hurricane crop damage. Agricultural output in St. Thomas also saw a steep decline of 27.2%.
• Within the Services industry, Accommodation & Food Service Activities fell 20.4% (an improvement from -31.0% in Oct–Dec 2025 but still deeply negative), Electricity, Water Supply & Waste Management declined 10.3%, Information & Communication contracted 7.1%, Transport & Storage fell 5.4%, and Education, Health & Other Services declined 5.2%. Only two sub-industries posted growth: Public Administration & Defence (+1.9%) and Financial & Insurance Activities (+1.8%), the latter reflects the sector's relative insulation from the physical shock.
• For the full Fiscal Year 2025/26, the economy is estimated to have contracted by 1.7%, with Goods Producing down 2.2% and Services down 1.5%. The annual contraction was driven by Mining & Quarrying (-16.0%) and Accommodation & Food Service Activities (-10.9%), partially offset by Financial & Insurance Activities (+3.1%), Public Administration (+1.1%) and Construction (+0.6%).
• Labour market indicators have, however, remained resilient. As of January 2026, the unemployment rate stood at 3.6% (down from 3.7% in January 2025), with youth unemployment improving to 10.7% from 12.3%.
• Preliminary high-frequency data for April 2026 point to continued near-term weakness, with airport arrivals down 22.5% and alumina production down 27.3% versus April 2025. The data confirm that tourism and alumina, two of Jamaica's principal foreign-exchange earners, remain materially impaired heading into the April–June quarter.
• Looking ahead, the PIOJ projects a further contraction of 3.0%–4.0% in April–June 2026, driven by ongoing geopolitical tensions in the Middle East and slow recovery in storm-affected industries. For Fiscal Year 2026/27, however, PIOJ forecasts growth in the range of 1.0%–3.0%, with all industries expected to expand as the economy recovers from the 2025 weather-related shock. This growth band is consistent with the Bank of Jamaica's own FY2026/27 projection.

(Source: Planning Institute of Jamaica)