• The All-Jamaica Consumer Price Index (CPI) for January 2026 decreased by 0.8%, according to data released by the Statistical Institute of Jamaica (STATIN). This contrasts with November and December readings following Hurricane Melissa, where the CPI rose by 2.4% and 1.3%, respectively.
• The main contributor to the decline in the CPI for January 2026 was the ‘Food and Non-Alcoholic Beverages’ division, which fell by 2.4%. A 9.9% fall in the index for the class, ‘Vegetables, tubers, plantains, cooking bananas, and pulses’ and an 8.4% decline in the index of the ‘Ready-made food products’ class were the main drivers. These declines were attributable to lower prices of some agricultural produce, including cabbage, carrots, cucumbers, escallion, sweet peppers and tomatoes. Supplies of these key short-duration crops rebounded in January, likely reflecting in part the efforts by the Ministry of Agriculture to get farming restarted quickly in the aftermath of Melissa through the distribution of seeds, fertilisers, etc.
• Still, the movement in the CPI was moderated by a 0.7% increase in the index for the ‘Housing, Water, Electricity, Gas and Other Fuels’ division. This was due to higher water supply and sewage rates, given the previous disruptions to infrastructure-intensive sectors such as electricity, water supply and waste management, caused by Hurricane Melissa. Additionally, the index of the ‘Education’ division rose by 1.0% due to increased preparatory school fees.
• The annual Point to Point (P2P) inflation rate also fell 0.6 percentage points to 3.9%, for the December 2024 to December 2025 period. As with the monthly figure, the slowdown featured a cooling of the ‘Food and Non-Alcoholic Beverages' class from 7.1% to 5.7%. On the other hand The ‘Housing, Water, Electricity, Gas and Other Fuels’ increased from (3.5% to 4.6%).
• While it’s still too early to call, the inflation decline seems to defy expectations of a rise in 2026, fuelled by higher electricity costs to cover reconstruction of the grid and demand pressures for construction and related materials to facilitate reconstruction efforts.
• In its December 2025 Quarterly Monetary Policy Report, the Bank of Jamaica (BOJ) projected average inflation of 7.4% over the period from December 2025 to September 2027. Core inflation was also expected to rise, exceeding the target range by mid-2026. However, given the unexpected decline in January’s reading amid lower food prices and the fact that the December spike stemmed from a supply-side shock, the inflationary impact of Hurricane Melissa could prove to be more temporary than previously anticipated. As such, the BOJ could revise its inflation outlook at its next Monetary Policy Meeting set for February 23, 2026. Nevertheless, expectations are for the BOJ to maintain its current policy rate at 5.75%.

(Sources: STATIN and NCBCM Research)

• For the nine months ending December 2025 (9M 2026), JMMB Group Limited (JMMBGL) more than doubled its earnings to $4.36Bn (+150.8%), while Proven Group Limited (PROVEN), which has a 20.0% stake in JMMBGL, saw a 39.2% earnings dip to US$1.45Mn amidst Melissa Disruptions.
• JMMBGL’s earnings growth reflected improved funding mix and disciplined capital allocation. These improvements led to a 69.9% increase in pretax earnings from its Banking & Related Services business segment as digital banking services usage and sales productivity increased. Consequently, a 38% surge in Net Interest Income (NII), an 8% rise in fees and commissions, and a 41% jump in fixed income trading gains supported a 23.4% increase in core revenues.
• Meanwhile, the group contained the increase in operating expenses to just 6.4% to J$18.89Bn, reflecting inflationary increases and spending on longer-term strategic initiatives aimed at improving the posture and positioning of the Group¹.
• With revenue significantly outgrowing OPEX, operating profit doubled to $3.56Bn. A similar doubling of the share of profit of associates to $3.48Bn², which countered a 15.3% increase in impairment losses on financial assets and a $1.06Bn increase in tax expenses, also contributed to the group's earnings leap.
• Notwithstanding the growth in JMMBGL’s earnings contributions, hurricane-related disruptions, elevated funding costs, and a slowdown in its manufacturing segment, which weighed on PROVEN’s core operations and caused 39.2% earnings decline for 9M 2026.
• Net operating revenues – which comprise NII, gross profit on manufacturing and property as well as other income – fell 5.4% to US$40.70Mn. NII declined by 19.4% amid elevated funding costs, but the company sees its 6.2% reduction in interest expense as a signal of early cost normalisation. Such a normalisation could support margin expansion into FY2027. Fee and commission income fell 21.7%, due to hurricane-related disruptions to PROVEN’s Cambio operations in Montego Bay. Reduced tourist arrivals and business interruptions dampened transaction volumes and FX trading income in the December quarter. Its Manufacturing operations, led by Roberts Manufacturing in Barbados, also declined by 7.7% to US$13.08Mn. The weight of these declines eroded the impact of a tripling of Net Fair Value Gains to $US4.05Mn, resulting in a negative operating revenue of US$2.66Mn.
• Concurrently, PROVEN’s OPEX rose 7.9%, owing to higher staff costs, depreciation and amortisation, and other operating expenses. As a result, the group had a US$2.66Mn operating loss. Nonetheless, a US$5.66Mn profit contribution from associates like JMMBGL, and, to a lesser extent, Access Financial Services (AFS) significantly cushioned earnings.
• Looking ahead, PROVEN’s management noted that it will continue to execute on strategic priorities that position it for an improved earnings trajectory. Major catalysts include the near-completion of the Sol Harbour and Bahari Phase 1 developments, which are expected to generate approximately US$4.2Mn in profits, primarily in the March 2026 quarter. Management also continues to implement targeted efficiency initiatives set to take effect late FY2026 and into FY2027 to enhance operational leverage and, with it, core operating profit.
• Since the start of the year, PROVEN and JMMB’s stock price has decreased by 17.01% and 12.29% to close at $12.73 and $16.846. At this price, PROVEN trades at a P/B of 0.55x, while JMMB trades at a P/E of 0.53x – both below the Main Market Financial Sector Average of 1.1x.

________________________

¹This includes its digital transformation, standardisation, and centralisation programme, as well as optimising its sales productivity through the continued integration of the sales segments.

²JMMBGL owns a 24.49% interest in Sagicor Financial Company Limited (SFC).

(Sources: PROVEN & JMMB Financial Release, NCBCM Research)

• The Trinidad and Tobago government says it has been issued two United States general licences providing a “clear and structured legal framework” for certain oil and gas activities involving Venezuela and shared maritime areas between the two countries. Prime Minister Kamla Persad-Bissessar described the licences as an opportunity to deepen hemispheric energy cooperation and strengthen regional stability.
• According to the licence terms, any payments of oil or gas taxes or royalties to Venezuela, its state-owned energy company Petróleos de Venezuela SA (PdVSA), or related entities must be directed to foreign government deposit funds or to other accounts as instructed by the US Department of Treasury. The licence also stipulates that it does not authorise payment arrangements deemed commercially unreasonable or involving debt swaps, gold payments or digital currencies issued by or on behalf of the Venezuelan government.
• The development comes amid ongoing negotiations surrounding cross-border natural gas projects between Trinidad and Tobago and Venezuela, including the Dragon and Manakin-Cocuina fields. In April 2025, Washington revoked Office of Foreign Assets Control (OFAC) licences that had previously allowed Trinidad and Tobago to pursue the Dragon and Manakin-Cocuina natural gas projects with Venezuela, citing concerns over democratic governance and migration issues in the South American nation.
• The Dragon field alone is estimated to hold about four trillion cubic feet of gas and had been expected to supply Trinidad and Tobago’s energy sector for years, with first exports originally projected for 2026. The revoked licences froze the projects, despite Trinidad and Tobago already paying more than US$1 million annually in taxes to Venezuela related to the anticipated 20-year Dragon initiative. By October 2025, a revised six-month OFAC licence was granted to allow renewed negotiations under strict conditions, marking a partial reopening of energy cooperation between the two countries.
• The latest licensing decision comes amid major geopolitical changes involving Venezuela. Last month, the United States launched a military operation in Venezuela that resulted in the detention of President Nicolás Maduro and his wife on drug- and weapons-related charges. US officials later said Washington would administer the country temporarily while overseeing a political transition. With the new licences now in place, Trinidad and Tobago says it intends to move forward with energy cooperation in a manner consistent with US law while positioning itself as a key regional energy hub.

(Source: Caribbean News Weekly)

• Mexican state oil company Petroleos Mexicanos has issued 31.5 Bn pesos ($1.8 Bn) in debt, ending a six-year absence from local markets. The transaction consists of 5.5 Bn pesos in notes known as “certificados bursátiles” maturing in 2036; 17 Bn pesos due 2034; and 9 Bn pesos maturing 2031. Demand stood at 2 times over the maximum amount, with the 2034 instrument with a fixed 10.8% rate attracting the most interest, according to a note from Banorte analysts Gerardo Valle and María José Hernández.
• The deal is the first of a 100 Bn peso shelf with a five-year window, according to filings with the Bolsa Mexicana de Valores. “This issuance marked Pemex’s return to the financial markets and was supported by participation from both domestic and international investors, reaffirming investor confidence” in the company’s 2025-2035 strategic plan, the Finance Ministry said in a statement, adding that final terms were below price talk. Proceeds from the transaction will be used to repay financial liabilities maturing in 2026, the Finance Ministry added.
• The last time Pemex tapped local markets was in December 2019, according to S&P Global. But the oil behemoth has been looking to address its massive debt load as part of a broader strategic plan — and Mexico’s government last year went on an unprecedented debt binge, in part to support the company. Chief Executive Officer Victor Rodriguez said this month that the company has reduced its total financial debt to its lowest level in 11 years.
• Further interest-rate cuts from Mexico’s central bank and a forecasted pickup in economic activity compared to 2025 are expected to support a rise in local issuance this year. Companies are also rushing to close pending transactions before an upcoming review of the USMCA trade pact, which could stir up market volatility. “We are anticipating additional debt to support new investments and acquisition processes,” Banorte analysts Gerardo Valle and María José Hernández. Further, some of Mexico’s biggest companies have debt due in the next few years, which will also spur refinancing activity, according to Moody’s Local Mexico.

(Source: Bloomberg)

• The Bank of England is expected to cut its policy rate in March, according to a majority of economists surveyed in a Reuters poll. At its February meeting, the Bank held the Bank Rate at 3.75% in a narrow 5–4 vote, marking the third consecutive closely split decision. Governor Andrew Bailey voted to keep rates unchanged. However, 41 of 63 economists now expect a 25-basis-point cut on March 19, which would bring the policy rate down to 3.50%.
• While a March cut is increasingly viewed as the base case, economists remain divided on the timing of any additional easing. Many anticipate a second rate reduction later in 2026, but uncertainty persists over whether it will occur in the second quarter or in the second half of the year. Median forecasts suggest Bank Rate will end 2026 at 3.25%, implying two total cuts this year.
• Market participants are similarly split. Among Gilt-Edged Market Makers surveyed, projections for year-end rates ranged widely from 3.75% to as low as 3.00%. When asked about the likely number of reductions this year, economists were nearly evenly divided between expecting one to two cuts and two to three cuts, reflecting ongoing uncertainty about inflation dynamics.
• Inflation remains the central risk factor shaping policy expectations. Although January consumer price inflation is expected to ease to 3.0% from 3.4%, it remains well above the Bank’s 2% target. A majority of economists expect second-quarter inflation to exceed the BoE’s own forecast of 2.1%. Underlying inflation is estimated at around 2.5%, and some analysts believe both headline and core inflation could remain near that level through year-end, potentially limiting the scope for aggressive easing.
• The Bank of England expects inflation to move closer to target by April or May due to temporary effects from regulated prices and fiscal measures. Wage growth is forecast to slow to 3.3% by year-end, consistent with inflation returning sustainably to target. However, some strategists have expressed surprise at the Bank’s relatively low 2026 inflation projections.
• The broader economic backdrop is modestly weak. Britain’s economy barely expanded in the fourth quarter of 2025, and growth is projected at 1.0% this year and 1.4% next year, largely unchanged from previous estimates. While this sluggish growth supports the case for rate cuts, persistent inflation pressures are keeping policymakers cautious.

(Source: Reuters)

• The European Union’s trade surplus continued to shrink in December, reflecting mounting pressure from U.S. tariffs and intensifying competition from China. Data showed the surplus narrowed to €12.9Bn from €14.2Bn a year earlier, as declining exports of machinery, vehicles, and chemicals more than offset savings from lower energy imports. The figures highlight growing structural strains on the bloc’s export-led economic model.
• S. tariffs have taken a clear toll on transatlantic trade. Exports to the United States, the EU’s largest export partner, fell 12.6% year-on-year, reducing the trade surplus with the U.S. by roughly one-third to €9.3Bn. While monthly figures showed some volatility, the broader trend indicates weaker sales as higher prices prompt U.S. buyers to reduce purchases or shift sourcing elsewhere.
• At the same time, competition from China is intensifying. The EU’s trade deficit with China widened to €26.8Bn from €24.5Bn, rising roughly 15% over the full year. Chinese exports of increasingly sophisticated technology have deepened competitive pressures on European manufacturers, crowding out domestic production in key sectors.
• Although there was a modest rebound in the monthly surplus, supported by machinery and vehicle exports, economists caution that regaining lost U.S. market share could take years. Given that net exports have been a primary driver of eurozone growth, the erosion of external demand raises concerns that the region may face prolonged expansion barely above 1% annually.
• Despite external headwinds, the domestic economy has shown resilience. AI-related investment and steady consumer demand are helping cushion the trade shock. The euro zone economy grew 0.3% in the fourth quarter of 2025, in line with preliminary estimates, implying annualised growth of roughly 1.25%.
• Labour market conditions remain supportive, with employment rising 0.2% quarter-on-quarter, reinforcing consumption through a still-tight job market. This internal strength is partially offset by weaker external demand.
• Fiscal expansion in Germany is also providing a buffer. Government plans to increase investment in defence and infrastructure are beginning to materialise, with defence-related orders already appearing in industrial data. While the spending rollout is gradual, it is expected to gather pace through the second quarter and reach full momentum by year-end, supporting overall growth.
• Policymakers are also viewing external challenges as a potential catalyst for long-delayed structural reforms. The European Central Bank estimates that removing internal trade barriers within the bloc could help offset losses stemming from U.S. tariffs, suggesting that policy adjustments at home may become increasingly important as global trade dynamics shift.

(Source: Reuters)

• FESCO’s earnings jumped 176.4% during the quarter ending December 2025 to $242.70Mn, fueled by strong revenue growth and lower finance costs.
• Quarterly revenues revved up 20.1% to $8.80Bn, buoyed by a 21.7% jump in total litres pumped across all products, including LPG. While pump prices for gasoline (E10 87 and E10 90) and diesel (ADO and ULSD) are set by the market and largely outside the company’s control, management keeps its foot on the gas when it comes to driving higher volumes.
• In line with higher volumes and higher fuel prices, the cost of sales rose 18.8% to $8.20Bn. However, this was outpaced by revenue growth, which allowed gross profit margin to rise by 102bps to 6.8%
• Operating expenses totaled $315.63Mn for the quarter, representing a 17.1% year-over-year increase compared to the same period last year. Higher staff costs, security expenses, motor vehicle expenses, and depreciation primarily drove the increase. Staff costs amounted to J$126.90Mn, up J$19.90Mn or 18.6% year-over-year, reflecting the expansion of the company’s workforce. This increase also incorporates adjustments to wage rates and salaries, Christmas bonuses, and costs associated with expanded operations, including additional company-operated locations and an expanded range of activities.
• Security expenses totaled J$22.40Mn for the quarter, an increase of J$9.2Mn or 69.5% year-over-year, reflecting additional operating locations and higher security rates. Motor vehicle expenses amounted to J$12.90Mn, a decrease of J$2.30Mn or 14.9% year-over-year. These costs, which include toll charges, reflect growth in the fleet to primarily support the haulage and distribution of LPG.
• Depreciation expense for the quarter was J$61.0Mn, reflecting the expansion of Plant, Property and Equipment (PPE), including investments in LPG infrastructure and service station assets.
• With strong performances in both the 2^nd and 3^rd quarters, Fesco has reported its best nine-month performance, with net profit of J$587.89Mn up 44.63%, exceeding its best full-year net profit. Topline expansion (5.97%) and lower finance cost (-13.30%) were the primary drivers of the nine-month performance.
• Its operations suffered minimal damage following Hurricane Melissa, even so the company-owned service stations and filling plants are fully covered by insurance. Looking ahead, FESCO plans to open four to five new dealer-operated service stations during the 2026 calendar year. This aligns with the company’s strategy of expanding its network, which now exceeds 20 stations islandwide, while delivering earnings growth at a compound annual growth rate (CAGR) of 47.3% over the past four years. This strategy has proven effective, and we believe further expansion will continue to create value for shareholders.
• FESCO’s stock has declined 9.1% year-to-date, closing at J$2.81 on Thursday. At its current price, FESCO trades at a price-to-earnings (P/E) ratio of 10.9x, which is below the Junior Market Distribution sector average of 14.1x. Despite stronger year-to-date performance, the stock price has remained largely unresponsive, suggesting that persistent negative market sentiment continues to overshadow solid underlying fundamentals.

(Sources: JSE & NCBCM Research)

• Following the catastrophic impact of Hurricane Melissa, which caused over US$8.8Bn in damages, the Government of Jamaica has proposed several tax adjustments to fund reconstruction and bridge the fiscal gap.
• To bolster the national budget and address public health, the Government will introduce a Special Consumption Tax (SCT) of $0.02 per ml on sweetened beverages, projected to generate $10.1Bn. Simultaneously, the tax net is being modernised to include international digital services and intangibles, such as streaming platforms and online software, bringing these globally consumed services under the local GCT framework.
• To preserve tax value and curb harmful consumption, the SCT on Alcohol will increase from $1,230 to $1,400 per Litre of Pure Alcohol (LPA), and the tax on Cigarettes will rise by $3.00 per stick (moving to $20.00 total).
• The Environmental Protection Levy (EPL) will increase from 0.5% to 0.8%, and the domestic tax base will be expanded to cover 100% of local sales to bolster climate resilience. It was first imposed on all goods imported, but later extended to the domestic market.
• The GCT rate for Tourism will be hiked from 10% to the standard 15% (effective April 2027). Furthermore, the 20% duty concession for public officials will be modified, requiring them to pay GCT on imported motor vehicles.
• To safeguard fiscal stability during the ongoing economic recovery, the Government has committed to extending the $11.4Bn annual transfer from the National Housing Trust (NHT). This budgetary support will now continue for an additional five-year term, securing essential revenue through 2031.
• The implementation of these new revenue measures is projected to generate $29.44Bn in revenues for the FY 2026/2027 fiscal year. As these measures normalise within the economy, the government anticipates a sustained revenue contribution of $15.60Bn for the 2027/2028 cycle. This two-year revenue stream is a critical part of the government's strategy to maintain fiscal discipline while funding essential infrastructure projects.

(Source: Ministry of Finance)

• According to the International Monetary Fund (IMF), Suriname is at a historic crossroads. In its latest Article IV report, the IMF welcomed the progress achieved under its program, concluded in March 2025, while noting that recent fiscal and monetary slippages have eroded earlier stabilisation gains at a time when Suriname approaches a pivotal transition to large‑scale oil production. The development of this new resource has the potential to generate significant improvements in living standards, but to do so, action is needed to build the institutions to manage these wealth gains; improve health, education and social outcomes; invest in infrastructure; and preserve macroeconomic stability.
• According to the IMF, GDP growth is slowing in Suriname, driven by a decline in gold production, and inflation has reversed its downward path. Gold production declined by 8% in 2024 and continued to disappoint in the first half of 2025. On the other hand, the growth of the non-natural resource economy was estimated at above 4% in 2024 and is expected to maintain a robust expansion. Inflation rose to 10.9% in October, largely due to sizable depreciation triggered by fiscal and monetary slippages.
• Nevertheless, economic activity is expected to remain solid. Non-natural resource growth is estimated to reach 4.7%in 2026, supported by positive oil-related sentiment. Activity related to the development of new offshore oil fields and relatively stable gold production is expected to keep GDP growth around 4% in 2026-27, according to the IMF. Furthermore, in 2028, offshore hydrocarbon production is expected to come online, pushing growth to around 30%.
• That said, progress on fiscal consolidation has reversed. The primary balance amounted to -1.1% of GDP in August, and supplier arrears grew by 1.75%. Expenditure rose significantly before the May election, unwinding a significant portion of the fiscal adjustment that was undertaken as part of Suriname’s IMF-supported program. There has also been insufficient effort by the new government to change course.
• Under its current policy, the IMF projects a primary balance of around 0% of GDP in 2026-27 as one-off expenditures from 2025 are not expected to be repeated, though lower than the targeted primary surplus of 2.7%. Consequently, additional measures to achieve fiscal consolidation are urgently needed. Faster consolidation would help restore cash buffers, improve confidence, and help retain regular market access. Limiting spending would also help contain the ongoing injection of local currency liquidity, bring inflation down to around 5%, and help anchor expectations. Fiscal prudence would also help build buffers against downside risks.
• Suriname’s socio-economic and political landscape may also constrain reforms. Of note, social vulnerabilities persist due to significant leakages in benefit programs and difficulties in reaching rural and interior populations. The new government, which took office in July 2025. intends to build on reform progress but is facing political and social pressure to relax fiscal policy and increase spending to address social and developmental needs.
• Overall, there remain important near-term downside risks to the outlook. Policy slippages in the coming two years have the potential to adversely affect macroeconomic stability. A renewed drought would again increase the cost of electricity generation, adding to the fiscal deficit and inflation. Finally, higher global food prices could also increase import inflation, while a decline in gold prices (or further declines in gold production) would undermine exports. These would result in lower fiscal revenues and constrain overall growth.

(Source: IMF)

• BP p.l.c (BP)^[1] is seeking a license from the U.S. government to develop its Manakin-Cocuina gas field that crosses the border between Trinidad and Tobago and Venezuela, its interim CEO Carol Howle told Reuters. Since the capture by the U.S. of Venezuela's former President Nicolas Maduro, several energy companies have been seeking to move forward with their projects in the South American country, including Shell with its Dragon and Manatee projects and BP with Manakin.
• BP intends to develop the field to bring more than 1 trillion cubic feet of gas to Trinidad to convert into liquefied natural gas for export. The company owns 45% of Trinidad's flagship Atlantic Liquefied Natural Gas (LNG) plants, which was 15% of BP's total LNG production in 2025, data from financial firm LSEG show.
• BP requires a license from the U.S. government to produce the Field, given continued U.S. sanctions against Venezuela's state-owned company, Petróleos de Venezuela (PDVSA), which operates on the Venezuela side of the border. The company originally had an Office of Foreign Assets Control (OFAC) license from the U.S. and a license from Venezuela to develop the Field, but it was cancelled by the Trump administration in 2025.
• Although the developments on the ground in Venezuela remain fluid, neighbouring Trinidad and Tobago stands to benefit from Nicolás Maduro’s US-orchestrated ouster. With Prime Minister Kamla Persad-Bissessar offering her support for the U.S. military’s Caribbean deployment previously, relations with Washington have strengthened, and the U.S. has pledged bilateral security and energy partnerships. This therefore improves the prospects for energy projects, providing a tailwind for Trinidad and Tobago’s energy sector.

(Sources: Reuters & BMI, A Fitch Solutions Company)

^[1] BP p.l.c., an integrated energy company, engages in the oil and gas business worldwide. The company operates through Gas & Low Carbon Energy, Oil Production & Operations, and Customers & Products segments.