• The Panama Canal Authority (ACP) announced on June 4, 2026, that it will reduce the maximum authorised draft for vessels transiting the Neopanamax locks beginning July 3, 2026, based on current and projected water levels in Gatun Lake and concerns that El Niño conditions could develop later in the year.
• The announcement is now more significant after the National Oceanic and Atmospheric Administration (NOAA) issued an El Niño Advisory on June 11, 2026, confirming that El Niño conditions have developed in the tropical Pacific. According to the NOAA, El Niño, the warm phase of the El Niño–Southern Oscillation (ENSO), is expected to strengthen into the Northern Hemisphere winter, with a 63% chance of a very strong El Niño.
• According to the ACP, the maximum authorised draft for Neopanamax vessels will be reduced from 15.24 metres / 50 feet to 15.09 metres / 49.5 feet of tropical fresh water. The adjustment forms part of the canal’s broader water-management strategy and will not affect the number of daily vessel transits.
• The measure marks the return of draft restrictions for the first time in around two years, likely rekindling concerns about a repeat of the 2023–2024 drought crisis. At the height of that crisis, water shortages cut canal throughput by as much as 40% below normal levels through transit restrictions and vessel draft limitations.
• Canal officials have sought to reassure customers, noting that unusually heavy rainfall during the latest dry season has left both Gatun and Alhajuela lakes at maximum capacity. The ACP said current water reserves provide a substantial buffer against potential El Niño-related water stress and that significant disruption is not expected before December, while weather conditions and hydrological forecasts will continue to be monitored weekly.
• However, the draft cut comes as the canal is already operating under increasing pressure from record U.S. energy exports and shifting trade flows linked to the Middle East conflict. According to Clarksons Research, product tanker transits reached record levels in April and May, while growing volumes of liquefied petroleum gas and ethane exports have intensified competition for available slots.
• Signs of congestion are already visible, with Clarkson’s Research estimating that deep-sea cargo vessel waiting times averaged 50 hours during April and May, up from around 30 hours before the recent surge in traffic. Competition for priority passage has also intensified, with average auction prices for canal transit slots reportedly trebling to around US$400,000, while some priority bookings have changed hands for as much as US$4Mn per vessel.
• The Panama Canal draft cut is modest, but strategically important because it comes at a time when water-management risks and geopolitical trade disruptions are overlapping. While current lake levels provide a buffer and daily transits are not being reduced, higher U.S. energy exports, Middle East-related rerouting, rising waiting times and record auction prices suggest that any future restrictions could have a larger impact on freight costs, vessel scheduling and global supply chains than the small draft adjustment might initially imply.

(Sources: Seatrade Maritime News, Panama Canal Authority & the National Oceanic and Atmospheric Administration)

• The European Central Bank (ECB) announced a quarter-point rate hike on Thursday, bringing its key interest rate to 2.25% as the Iran war continues to blow inflation off target. Markets had been pricing in a near-100% chance of the ECB raising rates by at least 25 basis points ahead of its June Governing Council meeting, according to London Stock Exchange Group (LSEG) data.
• The ECB’s Governing Council said the decision had been made in a bid to ward off inflationary pressures generated by the U.S.-Iran war. The central bank also raised its inflation forecasts, saying it now expects headline inflation in the euro zone to average 3% in 2026 before cooling to 2.3% next year and 2% in 2028. It said the outlook had been altered in response to expectations of higher energy prices, which are expected to feed on the cost of food, goods and services.
• Economic growth forecasts, meanwhile, were revised downward for this year and next year. The ECB now expects growth in the euro zone to average at 0.8% in 2026, 1.2% in 2027 and 1.5% in 2028. Officials said the growth outlook had been trimmed to reflect “a more pronounced impact of the war on commodity markets, real incomes and confidence.”
• The ECB said that its Governing Council “remains well positioned to navigate the uncertainty caused by the war,” and will closely monitor the situation — but it stressed that officials are “not pre-committing to a particular rate path.” Euro zone inflation rose to 3.2% in May, flash data showed earlier this month, as higher energy costs drove the region’s inflation rate further above the ECB’s 2% target. The eurozone economy grew by just 0.1% in the first quarter of the year.

(Source: Reuters)

• The Bank of England will leave its key interest rate unchanged at 3.75% on June 18, according to all 65 economists polled by Reuters, who remained uncertain about ​what the central bank will do later this year.
• Bank Rate will stay where it is through the ‌rest of this year, according to median forecasts in the June 5 to 12 polls, but nearly 40% of respondents predicted at least one hike. Only six expected a 25-basis-point cut by the end of the year. Governor Andrew ​Baileysaid earlier this month it was important to get inflation back to target and give households confidence about the ​central bank's ability to do so.
• Fellow BoE policymaker Megan Greenesaid last week she saw a growing case for raising interest rates as the Iran war drags on and boosts the chance of wide-ranging rises in prices across the economy.
• British inflation was seen peaking at 3.6% towards the end ​of this year, getting close to double the central bank's 2% target. It will average 3.3% across 2026 but ease to 2.6% in ‌2027. Prices ⁠have jumped as the U.S.-Israeli war with Iran led to soaring energy costs and disrupted shipping lines through the key Strait of Hormuz. Still, hopes grew on Friday for peace after U.S. President Donald Trump said a deal could be signed as soon as this weekend.
• Economic growth will be ​1.0% this year - revised up from a 0.8% projection in a May poll - and ​1.1% in 2027 ⁠before expanding 1.5% in 2028, the poll found. Earlier this month, the OECD nudged up its 2026 forecast for Britain to 0.9% from the 0.7% it predicted just after the Middle East conflict broke out.
• Firms in the country's dominant services industry suffered a small fall ⁠in ​activity in May as the strains of the Iran warpushed up costs ​sharply, a key surveyshowed last week. The economy contracted 0.1% in April, its first monthly drop since August, official data showed earlier on Friday.

(Source: Reuters)

• Recent company disclosures highlighted both capital allocation and governance considerations, with Caribbean Cement Company Limited (CCC) moving to reward shareholders through another dividend recommendation, while Dolphin Cove Limited (DCOVE) announced an upcoming change in its external audit arrangements amid a challenging operating backdrop.
• CCC advised that its Board of Directors has recommended a final dividend of J$2.0854 per share following its meeting on June 10, 2026. The proposal will be presented to shareholders for approval at the Company's Annual General Meeting on August 13, 2026. Shareholders on record as at August 28, 2026, will be eligible to receive the dividend, which is expected to be paid on October 15, 2026.
• The recommendation continues CCC's renewed commitment to shareholder distributions following a 17-year hiatus that ended in 2022. Since reinstating dividends, the Company has declared one annual payout each year, with distributions trending higher over time from J$1.5032 per share in 2022 to J$2.0979 in 2025. While the proposed 2026 dividend is marginally below last year's level, it remains broadly consistent with CCC's recent capital return profile.
• Separately, DCOVE advised that it has mutually agreed with KPMG that the firm will not seek reappointment as auditors at the next Annual General Meeting (AGM) on July 23, 2026. The Directors will proceed with a process of selecting new auditors to hold office until the subsequent AGM.
• The announcement follows a difficult period for DCOVE, characterised by delays in the release of its December 2025 audited financial statements, board-level changes, and operational disruptions stemming from Hurricane Melissa. These challenges weighed heavily on financial performance, with the Company reporting a consolidated net loss of US$2.34Mn for FY2025, compared to a net profit of US$1.83Mn in 2024, marking its first full-year loss since 2020.
• Market performance across both stocks has been mixed year to date. CCC’s share price (3.1%) advanced, while DCOVE has declined 14.2%. At this price, CCC traded at a P/E of 12.80x, well below the 58.44x Main Market Energy, Materials, and Industrials (EMI) sector average. DCOVE, which recorded a loss in FY2025, trades at a 0.93x price to book value, below the 1.75x average for its Junior Market peer group.

(Sources: JSE & NCBCM Research)

• Fitch BMI revised Barbados’ GDP growth forecast for 2026 down to 1.9% from 2.1%, compared with an estimated 2.7% in 2025. The downward revision reflects rising external headwinds linked to a longer-lasting US-Iran conflict, higher inflation and pressure on the key tourism sector.
• Inflation is expected to rise from an average of 0.9% in 2025 to 2.8% in 2026, driven largely by imported price pressures from higher international oil prices and shipping costs.
• The overall budget deficit is forecast to widen modestly from an estimated 0.4% of GDP in FY2025/26 to 1.2% in FY2026/27, as the government increases spending to support growth and cushion households and businesses from higher fuel prices.
• Despite the wider deficit, ongoing fiscal prudence is expected to continue, anchored by a healthy primary surplus. This should support a gradual decline in gross public debt from around 95% of GDP at end-FY2025/26 toward the government’s long-term target of 60%. Additionally, the central bank is expected to maintain the hard exchange rate anchor at BBD2.00/USD, supported by international reserves of around US$1.5Bn.
• Further escalation in the US-Iran conflict could create a more severe oil price shock, pushing inflation higher and placing additional pressure on growth. Rising energy and shipping costs could also intensify cost-of-living pressures and public discontent, while climate-related shocks remain a major risk given Barbados’ reliance on tourism.
• Barbados’ outlook remains relatively stable, but higher oil and shipping costs could pressure tourism, inflation and public spending at the same time. As such, the country’s strong fiscal framework, primary surplus and exchange-rate anchor will be an important buffers if global energy volatility persists.

(Source: BMI, A Fitch Solutions Company)

• Mexico’s annual inflation rate decelerated for a second consecutive month in May 2026, returning to the higher end of the central bank’s target range. However, concerns remain around future inflation trends and core price pressures.
• Consumer prices rose 3.94% year-over-year in May 2026, easing from 4.45% in April 2026 and coming in below economists’ forecast of 4.03% in a Reuters poll. This placed inflation back within Banxico’s target range of 3%, plus or minus one percentage point.
• Consumer prices fell 0.21% in May 2026, marking the first monthly decline in two years. The decline was larger than economists expected, as the Reuters poll had forecast a smaller 0.12% month-over-month fall.
• However, underlying price pressures remain a concern. The closely watched core index, which strips out some volatile food and energy prices, rose 0.22% month-over-month, while annual core inflation slowed only slightly to 4.19% from 4.26% in April.
• According to Pantheon Macroeconomics’ Chief Latin America Economist, Andres Abadia, while inflation is moving in the right direction, progress remains uneven, with core services inflation still running above levels consistent with Banxico’s target.
• Banxico recently ended its more than two-year monetary easing cycle, lowering its benchmark interest rate by 25 basis points to 6.50% in a divided decision, amid concerns about inflation risks linked to the U.S. and Israel war on Iran and a sluggish domestic economy.
• While Mexico’s softer headline inflation gives the bank some comfort that price pressures are easing, sticky core and services inflation suggest the central bank is unlikely to rush into further rate cuts. According to Capital Economics, the policy rate is likely to remain at 6.50% in the foreseeable future, despite the larger-than-expected fall in headline inflation.

(Source: Reuters)

• U.S. consumer inflation increased at its fastest pace in three years in May, boosted by surging prices for energy products amid the Middle East conflict, and giving more ammunition for the Federal Reserve to keep interest rates unchanged into 2027. The third straight month of ​strong increases in the Consumer Price Index reported by the Labour Department on Wednesday underscored the mounting pressure on households, which are increasingly tapping their savings to fund spending.
• Inflation eroded wages for a second ‌consecutive month in May, which could weigh on overall economic growth. The soaring cost of living is a political liability for President Donald Trump and his Republican Party, seeking to retain control of Congress in the midterm elections in November. Trump won the 2024 presidential election in large part because of his promise to lower inflation, but has seen his approval rating tumble as frustration mounts over his handling of the economy.
• The U.S. central bank tracks the Personal Consumption Expenditure Price Index for its 2% inflation ⁠ All inflation measures are running well above the Fed's target. Real average hourly earnings dropped 0.7% in the 12 months through May after falling 0.3% in April.
• The Consumer Price Index ​(CPI) increased 4.2% in the 12 months through May, the largest gain since April 2023, the Labour Department's Bureau of Labour Statistics said. The CPI advanced 3.8% year-on-year in April and rose 3.3% in March. Prices increased 0.5% over ​the month after climbing 0.6% in April. The rise in inflation was in line with economists' expectations.
• A 3.9% jump in the price of energy goods accounted for more than 60% of the rise in the monthly CPI. Energy prices rose ​3.8% in April. They vaulted 23.5% in the 12 months through May. Gasoline prices accelerated 7.0% over the month and were up 40.5% from a year ago. Prices at the pump have retreated in recent weeks as oil prices eased, raising cautious optimism among economists that May could be the peak in CPI inflation.

(Source: Reuters)

• The ​Bank of Canada (BoC) on left its key interest rate unchanged as expected and said it was ‌seeing limited evidence that higher energy prices were fueling broad-based inflation. But Governor Tiff Macklem reiterated that the bank would not hesitate to raise rates if need be to keep inflation in check.
• This decision marks the fifth consecutive meeting at which the BoC has left its key policy rate at the 2.25% ​level, as an array of factors have complicated the economic outlook. The Iran war, which has sent gasoline prices soaring, ​is squeezing household budgets, though Canada, as a net exporter of crude oil, is taking in more ⁠
• Data last month showed Canada's economy posted a surprise contraction in the first quarter versus the year before, making it two straight quarters of annualised decline, which some economists call a technical recession. Macklem, though, said that the economy had basically been flat over the ​last year.
• Canada's overall inflation rate in April ​rose to 2.8%, and Macklem said ​the bank expected it ⁠to hover around 3% before gradually easing toward the 2% target.
• Macklem noted that the Middle East war posed a dilemma for monetary policy makers. Raising rates to dampen inflation could further slow the economy, while ​easing rates to support growth increases the risk of persistently higher inflation.
• Economists see the upcoming review of the North American free trade deal - the ⁠United States-Mexico-Canada ​Agreement - as the biggest uncertainty hanging over the economy. Macklem reiterated that if the U.S. ​imposed significant new trade restrictions, the bank might have to cut rates. If, on the other hand, higher energy prices started leading to generalised inflation, "there may ​be a need for consecutive rises in the policy rate."

(Source: Reuters)

• Shareholder returns remained in focus this week, with dividend declarations, ongoing share buybacks, and corporate governance developments dominating releases among select JSE listed companies.
• Leading the corporate actions were dividend announcements from Kingston Wharves Limited (KW) and Eppley Limited (EPLY). On June 2, 2026, KW’s Board approved a dividend of J$0.26 per ordinary share, payable on August 14, 2026, to shareholders on record as of Thursday, July 16, 2026, which is also the ex-dividend date. Eppley’s followed with the declaration of an interim dividend of J$0.102 per share payable on June 26, 2026, to shareholders on record as of June 12, 2026, which is also the ex-dividend date. Eppley’s dividend announcement came against the backdrop of a strong first quarter, with earnings up 20.7% to J$298.4Mn, driven by broad-based growth across its real estate, asset management, leasing, and investment businesses and lower financing costs.
• Meanwhile, Scotia Group Jamaica (SGJ) signaled the potential for additional shareholder distributions advising that a dividend payment will be considered at its upcoming Board meeting on June 11, 2026.
• Beyond dividends, JMMB Group Limited (JMMBGL) continued returning capital to shareholders through its ongoing share repurchase programme. The company announced that on June 1, 2026, it purchased 60,901 ordinary shares on the open market at an average price of J$15.99, representing a significant discount to its book value per share of J$29.58 for a total of J$974,044.04. The shares were acquired through its broker, JMMB Securities Limited. The buyback forms part of a broader J$300.0 million programme funded from internal cash resources and aimed at enhancing long-term shareholder value.
• On the governance front, Medical Disposables & Supplies Limited (MDS) and Productive Business Solutions Limited (PBS) announced board changes. MDS reported the resignation of Independent Director Mrs. Sheree Martin, effective May 6, 2026. The Company indicated that the departure reflects the increased demands of a senior leadership role she recently assumed and noted that the Board will consider appropriate steps to fill the vacancy in due course. PBS also reported that Director Blondell Walker has resigned effective June 5, 2026, and subsequently appointed Eduardo Rodriguez, Group Chief Financial Officer, as an additional Director effective June 8, 2026. This appointment strengthens the Board's financial and executive leadership representation.
• Against this backdrop, investor sentiment toward these companies has remained mixed. Year to date, KW’s (+8.6%) and SGJ’s (+0.1%) share prices increased, while Eppley (2.1%), MDS (13.9%), and JMMBGL (20.8%) have declined. In terms of valuation metrics, JMMBGL (0.51x) and SGJ (0.98x) continue to trade below the Main Market Financial Sector average price-to-book (P/B) ratio of 1.09x. In contrast, EPPLEY overshot the sector’s average with a P/B of 2.44x.
• Meanwhile, MDS remains deeply discounted, trading at just 0.32x book value compared to the Junior Market Health Sector average of 1.23x, as ongoing losses continue to weigh on investor sentiment

(Sources: JSE & NCBCM Research)

• The Senate, on June 5, approved the National Housing Trust (Amendment) (Special Provisions) Act, 2026, authorising an annual J$11.4Bn withdrawal from the NHT to provide budgetary support to the Government's budget from fiscal year 2026/27 through 2030/31. The measure was passed without amendment and includes a sunset provision^[1] at the end of the period.
• The Government indicated that the continuation of the transfers reflects the increased fiscal demands arising from Hurricane Melissa, which have placed additional pressure on public finances and reconstruction spending requirements. The measure had previously been signaled as part of the Government's revised revenue framework announced in February.
• In discussing the NHT's capacity to support the transfers, the Government noted that housing supply challenges extend beyond financing and include factors such as the availability of serviced land, infrastructure constraints, construction costs, labour shortages, and planning and approval processes.
• From a fiscal perspective, the measure secures a recurring J$11.4Bn annual non-tax revenue source over the medium term. This helps to support budgeted expenditures amid elevated reconstruction and recovery costs. The transfers should provide additional fiscal flexibility while supporting Jamaica's broader fiscal consolidation and debt reduction objectives.
• The arrangement also underscores the Government's continued reliance on NHT resources as a source of budgetary support until the measure expires in fiscal year 2030/31. This diverts funding away from the agency’s mandate to augment and improve the overall supply of affordable housing across the country.

(Sources: JIS & NCBCM Research)

^[1] A sunset provision (or sunset clause) is a specific measure in a law, contract, or regulation that dictates an automatic expiration date for the agreement. Once that date is reached, the law or clause becomes void unless lawmakers or involved parties actively vote or agree to renew it.