• On March 2, 2026, Moody's Ratings affirmed LATAM Airlines Group S.A. (LATAM’s) Ba2 corporate family rating and the Ba2 ratings on its senior secured notes. It also revised the outlook to positive from stable, reflecting expectations of further improvement in credit metrics and liquidity over the next 12–18 months.
• The Ba2 rating reflects the company’s scale, strong network connectivity, and leading positions across key domestic and international markets in Latin America, supported by a diversified business portfolio of air transportation services, strategic alliances, improved capital and cost structures, and very good liquidity that positions the company to manage industry volatility.
• Operating performance remained robust in 2025, further strengthening LATAM's credit metrics. This provides the company with a reasonable cushion to withstand potentially weaker market conditions. Driven by sustained improvements in cost discipline and a disciplined approach towards capacity and airfares, Moody’s-adjusted EBIT margin grew to 14.8% (from 14.1% in 2024). Adjusted leverage improved to 2.1x, while free cash flow of $324Mn was generated. Leverage is expected to remain between 1.5x–2.0x over the next 12–18 months, alongside a projected cash balance of $2.0–$2.5Bn, well above the company's minimum cash requirements.
• LATAM has a very good liquidity profile, supported by $2.2Bn in cash at the end of 2025, a manageable debt maturity profile (with $1.5Bn due before the end of 2027), and $1.85Bn in revolving committed credit facilities, of which $1.58Bn remained available. Operating cash flow to be around $3.0–$3.5Bn over the next 12–18 months, which is sufficient to cover annual capex needs by approximately 1.3x and support positive free cash flow generation.
• LATAM’s credit rating could be upgrade if adjusted leverage remains below 3.0x and interest coverage above 5.5x on a sustained basis, alongside strong liquidity and positive free cash flow even during fleet expansion. Conversely, downward pressure on its rating could arise if leverage exceeds 4.0x, interest coverage falls below 4.0x, liquidity weakens, or demand and profitability shocks result in sustained cash burn.

(Source: Moody’s Ratings)

• Venezuela's oil exports fell 6.5% in February 2026 from a month earlier to some 737,000 barrels per day (bpd), as more shipments to the United States and Europe could not fully offset the loss of what had been the OPEC country's main market, China.
• Washington has controlled the South American nation's oil exports since early January 2026, when U.S. forces captured Venezuelan President Nicolas Maduro. Trading houses Trafigura and Vitol and U.S. producer Chevron are now exporting the lion's share of Venezuela's barrels under U.S. authorisations.
• Even as Chevron and the traders sent more cargoes to the U.S., Europe and the Caribbean last month, the increase was not enough to compensate for a 67% decline in exports to Asia, which averaged some 48,000 bpd, compared with 145,000 bpd in January 2026 and more than 600,000 bpd last year. A lack of very large crude carriers to transport bigger cargoes also limited exports from Venezuela, whose main oil port, Jose, handles about 70% of total shipments, creating a need for larger vessels to reduce loading times. Exports are expected to accelerate in March 2026, particularly to India, with at least half a dozen super tankers navigating to Venezuela to pick up cargoes.
• Overall, oil exports in February 2026 were 6.5% lower than in January 2026 and stood 19% below the same month of 2025. Meanwhile, Venezuela's direct exports to the U.S. rose 32% to about 375,000 bpd in February 2026, while shipments to Europe increased ninefold to 158,000 bpd, with Spain's Repsol leading purchases in that region.
• The U.S.-Iran conflict and fresh licenses granted by the U.S. Treasury Department in recent weeks are also expected to expand the pool of companies exporting and refining Venezuelan oil, which could ⁠lead to cargoes reaching new destinations. Notably, faster exports could help drain inventories, which remained high at the end of February at 12.7 Mn barrels in Jose, the second-highest monthly level since 2025, and 26 Mn barrels in the country.

(Source: Reuters)

• Brazil's economy grew 2.3% in 2025, its weakest performance since the COVID pandemic in 2020, as high interest rates squeezed consumption and investment. The expansion slowed from 3.4% in 2024, reflecting a sharp moderation in momentum amid restrictive monetary policy aimed at steering inflation, which stood at 4.1% in the 12 months to mid-February 2026, toward the central bank's 3% target.
• Growth in Brazil's services sector, the ​main engine of ⁠its economy, slowed to 1.8% in 2025 from 3.8% in 2024. Buoyed by a record harvest, particularly soy and corn, agriculture expanded 11.7%, while industry grew 1.4%, supported by oil and gas extraction.
• Weaker growth in household consumption, which rose 1.3% in 2025 compared with 5.1% in 2024, was mainly due to the adverse effects of contractionary monetary policy, while gross fixed capital formation, a proxy for long-term investment, increased 2.9%, well below the 6.9% expansion recorded the previous year.
• Notably, Brazil's economy had proved slow to cool following stimulus measures introduced when President Luiz Inacio Lula da Silva took office in 2023, which boosted demand and helped growth outperform earlier expectations. Further, central bank policymakers paused an aggressive tightening cycle last July and have since kept the benchmark Selic rate at 15%, the highest in nearly two decades. However, in January 2026, they signalled their intention to begin cutting rates this month.
• Brazil, Latin America's largest economy, posted just 0.1% growth in the fourth quarter from the previous three months, in line with a Reuters poll. That reinforced expectations of imminent rate cuts after the central bank signalled ​it would start monetary easing, despite above-target inflation.
• The central bank said in December 2025 it expected the economy to grow 2.3% in 2025 and slow further to ‌1.6% growth ⁠this year. The Finance Ministry, however, reiterated in a statement on Tuesday, March 3, 2026, a more upbeat forecast of 2.3% growth this year, arguing that a stronger slowdown in agriculture would be offset by faster expansion in industry and services.

(Source: Reuters)

• The immediate circumstances surrounding Washington-Beijing bilateral relations entering the April summit^[1] bear little resemblance to where they stood 12 months ago. Three developments have fundamentally shifted the near-term balance of advantage. The United States (U.S.) Supreme Court struck down the centrepiece of President Donald Trump’s trade policy. Mainland China has quietly accumulated leverage across multiple fronts, and an active American shooting war has erupted in Iran. Taken together, they have produced the most complex and consequential US-China summit in many years. BMI Fitch analysts believe the summit will proceed, and Beijing will enter it holding its strongest hand in years.
• The Supreme Court’s 6-3 ruling was not merely a legal setback for Trump; it materially improved China’s negotiating position ahead of the summit. The U.S. effective tariff rate on Chinese goods fell from the low 30s to approximately 21%. That reduction arrived without Beijing conceding anything in return. It was, in structural terms, a windfall. The ruling also created a credibility problem for Washington that goes beyond the arithmetic.
• Additionally, the geopolitical and economic fallout from ’Operation Epic Fury’ will cast a long shadow over the Trump-Xi summit. Beijing publicly confirmed it received no warning of the strikes. This is seen as a pointed diplomatic signal. It distances Beijing from complicity and also registers displeasure with Washington. But it stops short of anything that would derail the April summit.
• The communiqué will look substantive but commit to relatively little. In terms of trade and tariffs, the visible trade deliverables will be impressive but largely cosmetic. Soybean purchase commitments, energy deals, and Boeing orders; politically necessary for Trump and structurally cheap for Beijing. China has offered variations of these commitments at every major bilateral meeting. Nevertheless, the real trade question is the extension of the truce beyond its November expiry. Both sides have incentives to extend since neither has fully delivered on previous commitments.
• Concerning Russian oil, BMI does not expect China to agree to any meaningful reduction in Russian oil purchases. Discounted Russian crude is both economically rational and strategically valuable as insurance against future Western pressure on China’s energy access. Moreover, the Iran and Venezuela campaigns have removed two of China’s cheapest oil sources from easy reach.
• For technology and artificial intelligence (AI) Chips, the January shift to case-by-case AI chip licensing is seen as the most potentially durable development ahead of the summit. Replacing automatic denials with individual licence evaluation represents a quiet but significant policy shift. Expectations are that Beijing will push hard in April to formalise and expand it.
• Finally, TikTok remains an underappreciated wildcard. Beijing has demonstrated a clear willingness to use the consumer technology company as a geopolitical instrument, while Trump has demonstrated susceptibility to the personal branding opportunity the deal offers. Outstanding implementation questions could resurface either as a sweetener or as renewed leverage, depending on how other issues on the agenda resolve.

(Source: BMI, A Fitch Solutions Company)

^[1] The summit, expected in Beijing around March 31–April 2, aims to build on a previous 2025 "truce" that eased tariffs.

• President Donald Trump on Wednesday, March 4, 2026, officially nominated Kevin Warsh to be the next chairman of the Federal Reserve (Fed). Warsh, if confirmed by the Senate, would succeed Fed Chairman Jerome Powell for a four-year term. Trump’s nomination was transmitted to the Senate, the White House said in a statement posted online on Wednesday. That transmittal came more than a month after Trump first publicly announced he wanted Warsh as the Fed chairman.
• Powell's term as chair ends in May, but he has two more years as a Fed governor. Usually, chairs resign their governor terms after their chair term ends. But it's unknown if he will. Additionally, Senator Thom Tillis said he would block Warsh's nomination in the Senate until the investigation of Powell is dropped. His stance could block the nomination from consideration by the Senate.
• "Protecting the independence of the Federal Reserve from political interference or legal intimidation is non-negotiable," Tillis said on X right after Trump announced Warsh was his pick. "My position has not changed: I will oppose the confirmation of any Federal Reserve nominee, including for the position of Chairman, until the DOJ's inquiry into Chairman Powell is fully and transparently resolved."
• Warsh served on the Fed's board for five years, beginning in 2006, named by President George W. Bush. He serves as the Shepard Family Distinguished Visiting Fellow in Economics at the Hoover Institution and is a lecturer at the Stanford Graduate School of Business. He is also a Partner at Duquesne Family Office, a New York investment firm founded by Stanley Druckenmiller.

(Sources: CNBC & Yahoo Finance)

• Food and financial services conglomerate GraceKennedy Limited (GK) reported net profit of $6.90Bn for the year ended December 2025 (FY2025), representing an 18.2% year-over-year decline. The dip occurred despite achieving record revenues of J$177.80Bn. A 7.7% dip in operating performance in its Food and Money Services segments during the first nine months of the year was compounded by the impact of Hurricane Melissa in the fourth quarter, which led to a 56.5% decline in quarterly earnings. Together, they contributed to lower pretax earnings (PBT) for the group’s four segments.
• Annual PBT from its Food Trading Segment (GK Foods) is down 10.7% despite higher revenues (+6.0%), supported by solid growth in its international food operations. However, the temporary closure of its Grace Food Processing meat plants following Hurricane Melissa, along with higher-than-anticipated operating expenses, weighed on the division’s overall profitability. Additionally, its distribution sub-segment faced elevated warehousing and logistics costs, which also countered revenues.
• Meanwhile, its Financial Services segment, which comprises Banking and Investments (B&I), Insurance and Money Services (MS), also saw PBT decline by 20.6%, driven primarily by its Insurance and MS arms.
• Notably, its MS segment is down 20.4%, owing to a 4.2% decline in revenues, reflecting reduced transaction volumes. This occurred despite higher net YTD remittances, even before Melissa and a 14.2% jump for November 2025 following the hurricane. Management also pointed to tightening margins in some key markets, even as it retained market share in those territories.
• PBT from the Insurance segment is down 30.2% to $1.44Bn, despite higher revenues. Insurance revenues were up 17.3%, supported by strong top-line growth in general insurance and the continued success of its partnership with Scotiabank Jamaica, under which GK General Insurance underwrites ScotiaProtect. The expansion of this partnership into Barbados, the Turks and Caicos Islands, and The Bahamas in November 2025 has demonstrated encouraging early traction. However, elevated claims related to Hurricane Melissa weighed on general insurance profitability, albeit its reinsurance programme helped mitigate these impacts.
• Lastly, the B&I segment was flat relative to the other FS segments. Revenues were up 3.7%, driven partly by double-digit loan portfolio growth at its Jamaican commercial banking operations. However, the Jamaican investment and advisory business faced headwinds from a subdued capital market, including the local equity market and was further affected by higher provisions for credit losses.
• After achieving record revenues for FY2025 and assuming there is a normalisation of hurricane-related disruptions and expenses, GK could see profits rebound in FY2026. Moreover, it could see additional tailwinds from the full acquisition of Dairy Industries Limited, which allows GK to retain 100% of the profits from Dairy Industries, rather than sharing them through a joint venture. Additionally, the regional rollout of the GK One app into Trinidad, the Cayman Islands and Guyana is expected to shift remittance volumes to a lower-cost digital platform, reducing agent commissions. Moreover, a 5.50% interest rate environment could lower the group’s debt servicing costs if debts are refinanced. However, potential inflation pressures from the US-Israel war with Iran could keep inflation and interest rates higher for longer.
• GK’s stock price has declined by 12.6% year-to-date, closing at $71.67 on Tuesday. At this price, the stock is trading at a price-to-earnings (P/E) ratio of 10.3x, which is lower than the Main Conglomerate Sector’s average of 10.6x.

(Source: JSE & NCBCM Research)

• The Dominican Republic has announced plans to build a commercial spaceport in the province of Pedernales after reaching an agreement with U.S.-based company Launch on Demand, marking a major step toward the country’s entry into the global space economy.
• President Luis Abinader revealed the project during his State of the Nation address before the National Assembly, stating that the spaceport will involve an investment exceeding US$600Mn and aims to enable the launch of a satellite or rocket from Dominican territory before May 2028, following three years of negotiations with Launch on Demand and U.S. investment funds led by Burton Cantlich, a former operations director at NASA.
• The spaceport project forms part of a broader government strategy to diversify the economy through high-level technological partnerships, including collaborations with Nvidia and Google, with Nvidia supporting specialised training and an artificial intelligence centre of excellence, and Google planning to invest more than US$500Mn in a digital exchange hub with a data centre and submarine cable connections to the United States.
• Abinader said these initiatives position the Dominican Republic as a regional leader in advanced technology, digital connectivity, and innovation, enhance national competitiveness, attract global technology firms, and support the transformation of Pedernales into a tourism and logistics hub alongside infrastructure development.
• The president cited economic indicators, including 2.1% growth in 2025, exports of nearly US$16Bn, foreign direct investment surpassing US$5Bn, projections from institutions such as the World Bank and the Harvard Growth Lab, and alignment with RD 2036 and Harvard University’s Atlas of Economic Complexity ambition to rank among the world’s 20 most dynamic economies.

(Source: Dominican Today)

• President, Dr. Irfaan Ali on Monday, March 2, 2026, met with the executive of the Guyana Gold and Diamond Miners Association (GGDMA), where discussions centred on strengthening governance and advancing the digital transformation of the mining sector.
• During the engagement, the association commended the government’s forward-looking management of the industry, while President Ali stressed that success in the sector must be matched by full adherence to regulations, including accurate gold declarations and compliance with legal channels such as sales through the Guyana Gold Board, urging all gold miners to make a full declaration of gold produced in 2025 and warning that registered dredges with no declarations will be deregistered and illegal foreign miners identified for prosecution and expulsion.
• The GGDMA executive expressed its commitment to working closely with the administration to ensure efficiency and transparency, pledging support for modernising mining operations through the integration of digital tools to improve monitoring and reporting, initiatives expected to bolster accountability, streamline processes, enhance productivity, and safeguard future development.
• The Head of State announced a sweeping package of support measures for small miners, including outreach with commercial banks to bring miners into the formal financial system, reduce dependence on informal credit, and roll out financial literacy programmes in partnership with the Development Bank to help miners better manage savings, understand credit, and build sustainable economic futures.
• President Ali said the government will pursue and shut down delinquent operators who exploit state incentives while failing to declare gold, overhaul systems that have enabled chronic under-declaration and illegal exports, and noted participation in the meeting by Senior Minister with responsibility for Finance Dr Ashni Singh, Minister of Natural Resources Vickram Bharrat, and Minister of Public Service, Government Efficiency and Implementation Zulfikar Ally.

(Source: Guyana Chronicle)

• Iranian drone strikes on oil refineries in Saudi Arabia and Kuwait and on Qatar Energy’s Ras Laffan LNG complex, combined with Tehran’s announcement that it would close the Strait of Hormuz, sent shockwaves through global energy markets, pushing Brent crude briefly above $82 per barrel on March 2, 2026, and driving natural gas futures up about 40% in Europe and Asia. As a result of these global shocks, attention quickly turned to the implications for energy-dependent economies such as Cayman.
• The Cayman Islands is heavily exposed to products made from crude oil, such as petrol and diesel, because in addition to transport use, Cayman also generates most of its electricity from diesel oil, with a Caribbean Utilities Company (CUC) report noting “Our generators consumed approximately 40.6Mn gallons of diesel fuel and 109,833 gallons of lube oil in 2025 to meet electrical demand.”
• “CUC’s largest generating units operate on diesel, which means the company is closely tied to global fuel price movements,” said the company’s VP of Energy Operations Stephen Jay, who explained that although CUC does not source fuel directly from Middle Eastern producers, global crude market movements ultimately drive the cost of refined diesel and fuel prices in Cayman tend to move in step with broader international market trends.
• Beyond direct fuel costs, the global energy increases will also have less obvious impacts on Cayman, said Simon Cawdery, a director at HLX Management, noting that higher fuel costs raise shipping expenses and electricity costs, increasing company overheads and pushing up inflation, which “will be bad news for consumers in Cayman from a pure economics perspective”.
• Nevertheless, there are some silver linings for Cayman, as current market conditions for diesel show only a small increase, the islands are not heavy users of natural gas which insulates them from the most extreme price spikes, and the US, a net energy exporter whose key stock markets such as the S&P 500 rose slightly on Monday, has so far suffered little economic impact.

(Source: Cayman Compass)

• The large-scale United States (U.S.)-Israeli military campaign against Iran embodies U.S. President Donald Trump’s second-term foreign policy approach of being more interventionist overseas and embracing strategic military operations. Trump seeks to establish a foreign policy legacy that demonstrates US strength and corrects the perceived ‘failures’ of his predecessors.
• The U.S. actions in pursuit of these ambitious objectives, and Iran’s retaliation, have moved the conflict immediately to a scenario of a short-lived but large-scale campaign with significant implications for the Middle East and the global economy. Trump has committed to a campaign of up to 4-5 weeks and acknowledged that the lives of some American military personnel will be lost.
• This is a clear shift from his first-term foreign policy rhetoric, where he criticised previous U.S. interventions that lost lives, which BMI analysts believe highlights his more emboldened foreign policy approach this term and his recognition of the opportunity for his legacy from military action against Iran now.
• Domestic opinion could alter Trump’s calculus. Trump’s approval rating on foreign policy before the strikes on Iran was low, with only 40% of Americans approving of his approach. His approval ratings fell sharply in January after U.S. military action in Venezuela and his threat to take over Greenland. Despite an uptick in approval after the weekend's actions in Iran, the low approval generally signals Americans’ aversion to overseas military action. BMI expects Americans to be even more cautious of action in the Middle East, with protracted conflicts in Afghanistan and Iraq, as well as elevated energy prices, still fresh in their minds.
• Trump will also be sensitive to any negative economic impact from the conflict, especially the potential of higher U.S. inflation due to an oil price shock, as well as a sharp rise in bond yields. He is already under pressure on affordability (only 36% of Americans approve of his approach to inflation). Although BMI does not expect Trump to change course if the campaign proves short-lived, given little long-term price disruption, anything more protracted may do so.
• Of note, a prolonged campaign that causes a significant oil price spike to US$110-130 per barrel (/bbl) (from the baseline forecast of US$67/bbl for 2026) over the next quarter could increase average U.S. inflation by up to 1.1 percentage point (pp) from the 2026 forecast of 2.3%, which would be enough for Trump to change course and seek a quick end to the conflict.
• Finally, Congress is not expected to force Trump to end the conflict, despite it considering a war powers resolution this week. This is primarily due to the fact that enough members of Congress appear to support the administration’s military actions against Iran. If it did pass, the administration would still have a minimum of 60 days to end its actions without further Congressional approval. BMI does not expect that Trump would want to continue military action beyond that length of time, meaning such a vote would not change his strategy.

(Source: BMI, A Fitch Solutions Company)