• U.S. import prices unexpectedly fell in March, pulled down by decreasing costs for energy products, the latest indication that inflation was subsiding before President Donald Trump's sweeping tariffs came into effect.
• The report from the Labour Department on Tuesday, April 15, 2025, added to March's benign consumer and producer prices data. Economists expect tame readings in March in the key inflation measures tracked by the Federal Reserve for its 2% target.
• "There is likely to be a very painful and costly transition for the U.S. economy as Trump 2.0 tries to turn back the clock and go back to making things in America," said Christopher Rupkey, chief economist at FWDBONDS. "Import prices are not adding much to inflation for now, but the future outlook remains very much in doubt and not in a good way."
• Import prices dipped 0.1% last month, the first decline since September, after a downwardly revised 0.2% gain in February, the Labour Department's Bureau of Labour Statistics said. Economists polled by Reuters had forecast import prices, which exclude tariffs and are measured close to the beginning of the month, would be unchanged following a previously reported 0.4% increase in February.
• The import price data cemented economists' expectations that the Personal Consumption Expenditures (PCE) price index, excluding food and energy, edged up 0.1% in March after shooting up 0.4% in February. That would slow the annual increase in so-called core PCE inflation to 2.6% from 2.8% in February.
• That said, the White House's import duties campaign has triggered a damaging trade war with China and plunged financial markets into turmoil. Investors are fearful of high inflation and tepid growth or even a recession. Furthermore, the minutes of the Federal Reserve's March 18-19 meeting published last week showed policymakers were nearly unanimous that the economy faced risks of simultaneously higher inflation and slower growth, commonly referred to as stagflation.

(Source: Reuters)

• China is "tearing down walls" and expanding its circle of trading partners, "shaking hands" instead of "shaking fists", its foreign ministry said on Tuesday, April 15, 2025, as Beijing works on diversifying ties amid an escalating trade war with the U.S.
• Chinese President Xi Jinping, on Monday, kicked off a three-nation tour of Southeast Asia, which covers Vietnam, Malaysia, and Cambodia. In Vietnam, which is facing potential U.S. tariffs of 46%, Xi called for the two countries to oppose "unilateral bullying" and to strengthen cooperation in production and supply chains.
• President Donald Trump has added an eye-watering 145% of tariffs on Chinese goods this year as part of broader reciprocal duties on all U.S. trading partners. This prompted ridicule and criticism from Beijing, which retaliated by jacking up levies on U.S. goods by 125%.
• The World Trade Organisation has warned that the high-stakes China-U.S. trade row could cut the shipment of goods between the two economies by as much as 80% and severely hurt global growth.
• However, Beijing has called U.S. President Donald Trump's tariffs strategy "a joke", irritating U.S. Treasury Secretary Scott Bessent. "These are not a joke. I mean, these are big numbers," Bessent said in a Bloomberg Television interview." I think no one thinks they're sustainable, wants them to remain here, but it's far from a joke." Any U.S.-China negotiations would have to come from "the top," involving Trump and Chinese President Xi Jinping, Bessent also said.
• That said, a commentary published on Tuesday by China's state-run People's Daily underlined the need for unity amid the trade turbulence. "In the face of crisis, no one can keep only to oneself," the commentary said, referencing Dorothy's adventure in the American children's story The Wizard of Oz. "Only unity and cooperation can meet the challenge."

(Source: Reuters)

• Although the announcement on April 9, 2025, by President Trump that higher tariff rates would be paused for 90 days led to a sharp rally in financial markets, including U.S. bank stocks, Fitch Connect still holds a cautious outlook for banks across the globe.
• Financial services have not been directly hit by the tariffs, but banks will continue to navigate a challenging environment as they are vulnerable to second-round effects from tariffs, including weaker economic growth, volatile exchange rates and changing interest rate expectations.
• Moreover, recession fears dim the loan growth outlook and increase the risk of higher non-performing loans in markets such as Canada and the U.S., while in Asia, lower bank profitability, notably in Mainland China, could be the key risk. The removal of several ‘reciprocal’ tariffs will, however, ease some of the stress on financial markets across Asia Pacific (APAC), but risks remain elevated.
• One of the main premises in Fitch’s view is that the tariffs could prompt central banks to cut interest rates more rapidly than previously anticipated to stimulate economic growth. This would weigh on banks’ net interest income (NII) and likely result in bank earnings falling to pre-tightening levels at a quicker rate than previously expected.
• Moreover, significant uncertainty persists despite the reprieve, and Fitch anticipates continued volatility as markets adjust. Q1 2025 earnings were released for some of the largest banks on April 11 and continued to show that the largest U.S. banks are in good financial health and have benefited from high trading activity owing to stock market volatility surrounding President Trump.
• However, Fitch believes that U.S. banks will continue to face headwinds in the coming months, through second-round macroeconomic effects from the tariff turmoil, weaker loan growth, possible deteriorations in loan quality and lower profits.

(Source: Fitch Connect)

• U.S. President Donald Trump on Sunday, April 13, 2025, said he would be announcing the tariff rate on imported semiconductors over the next week, adding that there would be flexibility with some companies in the sector.
• The president's pledge means that the exclusion of smartphones and computers from his reciprocal tariffs on China is likely to be short-lived as Trump looks to reset trade in the semiconductor sector.
• "We wanted to uncomplicate it from a lot of other companies, because we want to make our chips and semiconductors and other things in our country," Trump told reporters aboard Air Force One as he travelled back to Washington from his estate in West Palm Beach. Trump declined to say whether some products, such as smartphones, might still end up being exempted, but added: "You have to show a certain flexibility. Nobody should be so rigid."
• The White House had announced the exclusions from steep reciprocal tariffs on Friday, creating some hope that the tech industry might escape being ensnared in the escalating conflict between the two nations and that everyday consumer products such as phones and laptops would remain affordable.
• However, Trump's commerce secretary, Howard Lutnick, earlier on Sunday made clear that critical technology products from China would face separate new duties along with semiconductors within the next two months.

(Source: Reuters)

• The Jamaica Stock Exchange (JSE) celebrated its first listing on the Junior Market since the beginning of the year with the listing of Atlantic Hardware and Plumbing Company (AHPC) Limited on April 4, 2025. From its Initial Public Offer (IPO) released in February 2025, the Company successfully raised capital of approximately J$500.0Mn and onboarded 3,218 new shareholders to their Company.
• The total capital raised by the companies listed on the Junior Market, including nearly JA$500 million raised by AHPC, amounts now to over J$22.6Bn. AHPC’s listing on the JSE has also increased the number of companies listed on the Junior Market to 48 and 104 companies overall and a total of 152 securities on the Stock Exchange.
• Marlene Street Forrest, Managing Director of the Jamaica Stock Exchange stated, “This represents an offer of 20.0% of the shares of the company to new investors. At a market capitalisation of approximately J$2.5Bn, this places AHPC among the top 20 companies on the Junior Market by market capitalisation. Additionally, with its listing, “AHPC will increase the market capitalisation of the Junior Market to over J$144.5Bn and the overall market capitalisation of the combined markets to J$1.86Tn, as at April 4, 2025,” said Dr. Street Forrest.
• “Atlantic Hardware & Plumbing is now well-positioned to enjoy the many benefits of a listed company. High on the list are the raising of the company’s profile, the improvement in corporate governance standards, and the additional capital to build the brand. This is possible via an Exchange that is focused on keen regulatory oversight, encouraging good corporate governance and one that provides the infrastructure for new products and services,” said Dr. Street Forrest.”
• Since listing on the JSE at $1.00 per share, AHPC’s stock price has declined by 10.0% to $0.90 per share.

(Source: JSE and NCBCM Research)

• Prime Minister, Dr. the Most Hon. Andrew Holness, says the US$13.0Mn Kingston Gateway Commercial and Warehouse Complex is poised to become a landmark development, impacting not only Kingston, but also strengthening Jamaica’s logistics and commercial ecosystem as a whole.
• This project is a collaborative effort between PROVEN REIT Limited (PREIT) and SAJE Logistics Infrastructure Limited (SAJE), marking PREIT's inaugural venture into the logistics sector and was slated for completion by December 2025.
• Situated at 221-223 Marcus Garvey Drive within Kingston’s bustling industrial corridor, the project will feature 21 warehouses offering 112,000 square feet of rentable space built to global standards.
• Welcoming the development of the mixed-use commercial offices and warehouse complex, Opposition Spokesperson on Industry, Investment and Global Logistics, Anthony Hylton, said it is likely to lift the operating standards of the multiple legacy projects and facilities currently occupying space in the surrounding area.

(Source: JIS)

• Barbados has secured a $30Mn loan from the World Bank to enhance its disaster risk management and ensure quicker, more effective responses in the face of emergencies. The Disaster Risk Management Development Policy Loan includes the Catastrophe Deferred Drawdown Option (Cat DDO), an innovative World Bank financing instrument that will provide a fast-access line of credit to support a timely and effective response once an emergency is declared.
• This project arrives at a critical time for Barbados, the World Bank noted. Despite its strong economic recovery, the country remains highly vulnerable to natural hazards. The Cat DDO will provide Barbados with a vital financial buffer, allowing the government to respond swiftly to emergencies without diverting resources from other priorities or compromising long-term development goals
• To access the Cat DDO, Barbados will implement a set of key reforms focused on two core areas: enhancing financial resilience and strengthening physical planning and livelihoods.
• This initiative complements the recently approved Barbados Beryl Emergency Response and Recovery Project, which supports the rehabilitation of the fisheries sector, Bridgetown Port, and critical infrastructure damaged by Hurricane Beryl.
• Barbados joins other Caribbean countries that are using Cat DDOs to build financial buffers and institutional capacity to handle increasing disaster risk, including St Vincent and the Grenadines, Jamaica, Grenada, Dominica, and Saint Lucia. Financial support for technical assistance for necessary policy reforms was and will continue to be provided by the European Union through the EU Resilient Caribbean Programme, managed by the Global Facility for Disaster Reduction and Recovery.

(Source: Barbados Today)

• The number of vessels that transited the Panama Canal, the world's second-busiest waterway, fell to an average of 33.7 per day in March for a total of 1,045 ships that month, according to a bulletin on Thursday by its administrative authority.
• In February, an average of 34.8 vessels per day crossed the waterway, an increase from 32.6 per day in January, but still below the maximum number of ships authorised. Transits this year remained below the maximum of 36 vessels allowed to pass per day since the waterway lifted drought-related restrictions in the third quarter last year, despite lower fees. Transit fees in Panama this year have been 15% below last year's levels, according to figures from its authority.
• A severe drought between late 2023 and early 2024 forced the waterway that connects the Atlantic and Pacific oceans to impose passage restrictions that prompted long waiting lines and higher transit fees.
• The fees have been closely monitored since U.S. President Donald Trump complained about them earlier this year, adding that Washington would take over the canal if it determines that the presence of firms from China and Hong Kong near the waterway constitutes a security risk.
• In late March, the canal's authority announced it would offer a net-zero weekly passage slot starting in October for dual-fuel vessels operating at low carbon intensity. The plan is part of an initiative to reward and encourage investments in energy efficiency and low-carbon fuels.

• Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill, says Jamaica is not immediately affected by the ongoing tariff struggle between the world’s largest economies, the United States (US) and China.
• He disclosed this while responding to questions regarding the new tariff measures implemented by the US during Wednesday’s (April 9) post-Cabinet press briefing held at Jamaica House. US President Donald Trump recently announced a sweeping set of new tariffs, including a 10 percent baseline tariff on nearly all imports entering the US, and reciprocal tariffs on various countries.
• On Wednesday, President Trump announced a 90-day pause on tariffs for more than 75 trading partners except China, which will see a 145 percent hike on levies on products entering the US. Minister Hill said that while Jamaica is not the target of either of the economic powerhouses, “we have to be very aware and nimble”.
• Under the Caribbean Basin Initiative (CBI), products from most Caribbean countries enter the US under preferential arrangements. However, he expressed confidence in Jamaica’s ability to overcome any challenges if the CBI is no longer in place for Caribbean countries.
• That aside, while the Liberation Day tariffs are likely to bring major short-term uncertainty, if they become effective after the 90-day pause, they may also open the door for Jamaica to strengthen U.S. ties and carve out new trade and investment opportunities in a rapidly evolving global landscape.
• At the same time, Jamaica must also look for opportunities to build new trade relationships to find new markets for our exports and find new source markets for tourism and other services. Diversifying our trade and investment partners will not only protect the economy from external shocks but also unlock new growth opportunities in a shifting global order.

 (Sources: JIS & NCBCM Research)

• Net Remittance Inflows to Jamaica increased by 4.0% in January 2025 year-over-year (y-o-y), rising from US$228.3Mn to US$237.5Mn. This was primarily due to an increase of US9.5Mn (or +3.9%) in total remittance inflows to US$255.5Mn. However, this was marginally offset by a 1.8% rise in remittance outflows.
• Higher inflows through both Remittance Companies and the Other Remittances channel, representing flows via commercial banks and building society, was the main driver of the increase.
• However, for the first ten months of the 2024/2025 fiscal year (April 2024 to January 2025), net remittances were largely flat at US$2.63Bn compared to US$2.62Bn for the 10 months in FY 2023/2024. The year to date (YTD) outturn was moderated by total remittance inflow, which was relatively flat at US$2.816Mn (up US$0.8Mn) and a US$3.8Mn decline in remittance outflow during the period.  
• The U.S. remains the largest source market for remittance flows to Jamaica in January 2025. Remittances from the U.S accounted for 69.7% of total flows, up from the 69.0% recorded for January 2024. Other source countries that contributed a notable share of remittances for the month were the United Kingdom (10.8%), followed by Canada (8.2%, and the Cayman Islands (6.5%).
• The data also indicated a slight contraction in remittance service operations for the 2024 calendar year. The number of active remittance company locations declined from 514 to 492, and total service points fell from 858 to 842. This reduction was mainly driven by an increase in voluntary closures, up from 32 to 49 and a rise in license revocations from 46 to 83.
• Looking ahead, the uncertainties around the Trump administration's trade, immigration and other policy changes could adversely affect remittance inflows if they result in a slowdown in the US economy.

(Sources: BOJ and NCBCM Research)