• Federal Reserve officials, including U.S. central bank chief Jerome Powell, on Wednesday continued focusing on the need for more debate and data before interest rates are cut, a move financial markets expect to occur in June.
• "Recent readings on both job gains and inflation have come in higher than expected," Powell said in a speech to the Stanford Graduate School of Business, and while policymakers generally agree rates can fall later this year, that will only happen once they "have greater confidence that inflation is moving sustainably down" to the Fed's 2% target.
• His remarks repeated the language the Fed has adopted as it tries to balance the risks of cutting interest rates before inflation is truly controlled with the risks of suppressing economic activity more than is needed.
• As he did at his press conference at the end of the Fed's last policy meeting on March 20, Powell maintained the baseline outlook that rates will fall "later this year," and said that recent data did not "materially change the overall picture which continues to be one of solid growth, a strong but rebalancing labor market, and inflation moving down toward 2% on a sometimes bumpy path."
• However, he hasn’t hinted at when the Fed might loosen its grip on credit, with upcoming jobs data, including the March nonfarm payrolls report on Friday, and incoming inflation readings next week, important in shaping the outlook for the central bank's April 30-May 1 and June 11-12 policy meetings.
• "Given the strength of the economy and progress on inflation so far, we have time to let the incoming data guide our decisions on policy," Powell said, with decisions made "meeting by meeting.

(Source: Reuters)

• Increasing Treasury yields are testing the ongoing rally in U.S. stocks, which have reached record highs, making them more expensive. This rally was partly fueled by expectations of Federal Reserve interest rate cuts, but rising yields are altering those expectations.
• Despite a strong economy and corporate earnings, concerns arise over stock vulnerability due to elevated valuations amidst climbing yields. Higher yields increase the attractiveness of Treasury bonds over equities and raise capital costs for businesses and households.
• Initially, there were expectations for significant Federal Reserve rate cuts in response to economic conditions. However, strong economic data has caused doubts regarding the extent of rate cuts the Fed will implement, impacting market sentiment.
• Various indicators suggest that stock market valuations are less favourable, with some investors predicting a long-awaited correction. The absence of significant market declines since October contrasts with historical trends, raising concerns.
• Stocks' response to rising yields hinges on perceptions of economic strength and inflation trends. If yields rise due to robust economic growth, investors may remain optimistic. However, slowing growth coupled with climbing inflation could unsettle investors. Key data releases, such as jobs reports and earnings season, will influence market sentiment in the near term.

(Source: Reuters)

• Honey Bun (1982) Limited (HONBUN) announced that its Board of Directors approved the Company to sign an agreement to expand its capacity by leasing a location at MJS Technology Park, Angels, Spanish Town. 

• The company signed a long-term lease agreement for the 160,000 square feet which signifies its optimism about future prospects.

• Honey Bun’s CEO Michelle Chong highlighted that the expansion was necessary as the company’s products are in high demand and that the company has outgrown its current facility in Retirement Crescent, Kingston.

• Deputy CEO Daniel Chong noted that the long-term-lease of the new four-and-a-half-acre property will initially see Honey Bun moving half of its operation from its current Kingston facility and will be operational in the next 7 to 10 months.

• This expansion will more than double its manufacturing capacity and is part of the company’s aggressive growth and expansion strategy.

• The new facility will be between two major highways, giving Honey Bun greater access to markets outside the Kinston and St. Andrew metropolitan area.

• According to Executive Chairman Herbert Chong, the current facility will continue to supply Kingston and St Andrew, St Thomas, Portland and St Mary, while the new Angels facility will service the rest of the island.

(Sources: JSE, NCBCM Research)

• As visitor arrivals continue to grow, the Tourism Minister, Hon. Edmund Bartlett, is highlighting the need to increase the production of goods and supplies to meet the growing demand in the sector.

• He noted that while the demand for agricultural produce for manufactured goods is escalating, supply is an issue.

• He was speaking at the Montego Bay Chamber of Commerce and Industry’s Expo 2024, held recently at the Montego Bay Convention Centre in Rose Hall, St. James.

• The Minister noted that last year, Jamaica welcomed four million tourists who spent approximately US$4 billion. Since the start of 2024, close to 1.5 million tourists have visited the island’s shores, generating foreign exchange earnings of almost US$2 billion.

• He highlighted that increasing local production is critical in enabling the country to retain a larger portion of the tourist dollar, ensure the sector’s sustainability and maximise economic benefits for the country.

• The Minister further emphasised that the country should start looking at the supply side and how it can bring more food, pots, pans, cans and kettles to be utilised in the service of tourism.

(Source: JIS)

• As visitor arrivals continue to grow, the Tourism Minister, Hon. Edmund Bartlett, is highlighting the need to increase the production of goods and supplies to meet the growing demand in the sector.

• He noted that while the demand for agricultural produce for manufactured goods is escalating, supply is an issue.

• He was speaking at the Montego Bay Chamber of Commerce and Industry’s Expo 2024, held recently at the Montego Bay Convention Centre in Rose Hall, St. James.

• The Minister noted that last year, Jamaica welcomed four million tourists who spent approximately US$4 billion. Since the start of 2024, close to 1.5 million tourists have visited the island’s shores, generating foreign exchange earnings of almost US$2 billion.

• He highlighted that increasing local production is critical in enabling the country to retain a larger portion of the tourist dollar, ensure the sector’s sustainability and maximise economic benefits for the country.

• The Minister further emphasised that the country should start looking at the supply side and how it can bring more food, pots, pans, cans and kettles to be utilised in the service of tourism.

(Source: JIS)

• Chile's central bank cut its benchmark interest rate on Tuesday by 75 basis points to 6.50%, in a unanimous decision by its governing board, saying the rate would likely be reduced further.

• The cut is in line with forecasts in a traders' poll last week, which also predicted the bank will reduce the rate to 4.25% within 12 months.

• Chile's central bank raised interest rates from 0.50% in mid-2021 to a cycle-high of 11.25% in late 2022. The bank held at that rate before kicking off monetary easing in July 2023, as inflation began to cool.

• Chile's annual inflation peaked at 14.1% in August 2022 and came down to 3.9% at the end of 2023. It has since gone back up, reaching 4.5% in February.

• The central bank's board on Tuesday added that inflation expectations are aligned with its 3% target, and "rising inflation figures at the beginning of the year and higher imported cost pressures emphasize the need to continue closely monitoring its evolution."

• While Chile faced a sharp economic downturn in 2023 after a rapid post-pandemic recovery, the economy "has succeeded in closing the significant macroeconomic imbalances of previous years," the board said.

(Source: Reuters)

• The World Bank has approved a loan of $750 million to Colombia, to help the country become more resilient in the face of climate change by buoying up renewable energy efforts and reducing carbon emissions, the bank said on Monday.

• The loan looks to boost the development of solar and offshore wind energy and green hydrogen, as well as bolster electric urban transport and multimodal transport, the bank said in a statement.

• "It is important for Colombia to take up the transition toward a more resilient economy, with low carbon emissions and a focus on sustainable management of natural resources," the statement said.

• The loan is the bank's second to the South American country focused on climate change, after a Dec. 2022 loan of $1 billion.

 (Source: Reuters)

• Prime Minister Justin Trudeau on Tuesday launched a C$6.0Bn (US$4.42Bn) Canada Housing Infrastructure Fund to accelerate the construction and upgrading of housing.

• The fund is one of the many schemes proposed by the government to spur the construction of houses and will be a part of the upcoming budget on April 16.

• The government will allocate around one-fifth of the money to municipalities to build critical infrastructure around houses and the rest will go to provinces and territories to build houses for the middle class.

• Canada faces a housing affordability crisis as a rapidly increasing immigrant population has far outpaced the number of available homes, increasing prices and rents. Additionally, 22-year high interest rates have also recently driven up mortgage costs.

• Of the C$6.0Bn, C$1.0Bn is slated to be allocated to municipalities to support urgent infrastructure needs such as water, sanitation etc. The remaining C$5.0Mn will be for agreements with provinces and territories to support long-term priorities.

(Source: Reuters)

• Inflation fell in six economically important German states in March, preliminary data showed on Tuesday, suggesting that national inflation will continue its downward trajectory.

• "The combined message from the data in Germany, France, Italy and Spain is that the eurozone headline harmonized inflation will undershoot the consensus this week significantly," said Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics.

• Economists polled by Reuters forecast Germany's harmonized inflation at 2.4% in March, down from 2.7% in February.

• German companies' price expectations also fell in March to their lowest in three years, with inflation set to fall below the European Central Bank's target in the coming months, the Ifo Institute said on Tuesday.

• Euro zone inflation is expected at 2.6% in March, unchanged from the previous month, a Reuters poll of economists shows.

• ECB chief Christine Lagarde said in March the eurozone's inflation rate was set to keep falling, while economic growth would start picking up during the year.

• A growing number of ECB policymakers have supported rate cuts, with a June meeting shaping up as the most likely time for action, although there is also a meeting set for this month.

 (Source: Reuters)

• Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, says the Reverse Income Tax Credit provision is intended for the mass of working citizens who contribute to the Jamaican economy through monthly or regular statutory deductions.

• Closing the 2024/25 Budget Debate in the House of Representatives on Tuesday (March 26), Dr. Clarke said the primary beneficiaries will be persons regularized before the end of the fiscal year, who earn below the income tax threshold, particularly Jamaicans earning close to the minimum wage.

• He noted that there are already approximately 570,000 Jamaicans who earned less than $3 million (approx. 450,000 less than $1.5 million) in 2023 who contributed to the system via Education Tax, National Housing Trust (NHT) and National Insurance Scheme (NIS) statutory deductions.

• During his presentation to open the 2024/25 Budget Debate, Dr. Clarke said the initiative means that every registered taxpayer who earns $3 million or under will benefit from a reverse tax credit of $20,000.

• The funds will be made available through an online platform to make the process secure and efficient.

(Source: JIS)