• U.S. consumer confidence fell to a five-month low in February, with fewer consumers planning to purchase homes, automobiles and go on vacation over the next six months amid concerns about the short-term economic outlook. 
• The survey from the Conference Board on Tuesday also showed consumers' inflation expectations rising after moderating for two straight months. But with the labour market rapidly churning out jobs and COVID-19 cases subsiding, the second straight monthly decline in confidence and drop in buying intentions likely do not signal a major slowdown in consumer spending. 
• Retail sales surged in January even as confidence ebbed. Consumers accumulated more than $2.0Tn in excess savings during the pandemic, which should help to underpin spending. 
• The Conference Board said its consumer confidence index dipped to a reading of 110.5 this month, from 111.1 in January. This is the lowest since last September 2021 and the index remains above its pandemic lows. 
• The survey's measure of current conditions improved, likely because of declining coronavirus infections that were driven by the Omicron variant. Its gauge of expectations for growth in the short term fell to a five-month low, suggesting a cooling in growth in the first half of the year. But the slowdown will probably be modest, with business activity regaining speed in February as the drag from the Omicron surge diminishes.

(Source: Reuters)

• The Development Bank of Jamaica (DBJ) is anticipating the provision of $9.5Bn in loans to Micro, Small and Medium-sized Enterprises (MSME) during the new financial year. 
• This is in addition to $6.24Bn in credit guarantees, US$24.4Mn in equity financing, and capacity-building support to 440 entities. 
• As contained in the Public Bodies Estimates of Revenue and Expenditure for the year ending March 2023, the support from the DBJ is aimed at addressing the gaps in the MSME ecosystem, which hamper growth in the industry, by improving the entities’ access to business development and financing. 
• Following the Wigton and TJH IPOs in recent years, the DBJ will also continue to assist in the divestment of government-owned assets, by facilitating investment through public-private partnerships and privatisations. 
• In keeping with this imperative, the agency intends to bring closure to transactions including Jamaica Mortgage Bank, Jamaica Railway Corporation, Montpelier, and the Cocoa Industry Board. We could therefore see more opportunities for investors through the privatisation of these companies, as the Government of Jamaica aims to put the ownership of key strategic assets in the hands of Jamaicans.

(Source: JIS & NCBCM Research)

• The sustainable use of Guyana’s forest resources has generated great returns over the years, especially in the area of timber production and exportation, which is projected to remain lucrative this year, with estimated returns of US$28Mn. 
• As outlined by the country’s 2022 Budget, timber output grew from 344,179 cubic meters in 2020 to 383,189 cubic meters in 2021, reflecting an expansion in construction activity. 
• Guyana has one of the highest percentages of forest cover in the world and presents immense opportunities to investors, who are interested in sustainably utilising and developing forest resources. Already, persons have capitalised on those opportunities, and this is evidenced by returns from the exportation of timber in 2021, which amounted to US$26.5Mn. 
• The growth that Guyana has experienced from its forestry sector will present an opportunity for increased export earnings, job creation and economic growth on a whole for the nation.

 (Source: The Tribune)

• Chilean authorities have reported that unemployment nationwide had fallen in 2021 to 7.2% while in the same period of 2020 it had hit 10.3%. In the middle of the social uprisings of 2019, it had been recorded at 7.1%. 
• This is the eighth consecutive annual decrease in the unemployment rate, with the unemployment rate for women at 7.4%, and for men at 7.1%. Jobs were boosted by construction (22.2%), commerce (8.5%) and hotels and restaurants (30.9%). 
• If the country continues at this rate, then it is possible to recover all the jobs that were lost in the worst moment of the pandemic. However, Leonardo González of the National Institute of Statistics (INE), warned, that “we have been consistently seeing these rates rise, but we are not yet seeing pre-pandemic levels.” 
• The recent unemployment figures are a good indication of the recovery of the Chilean economy. This will positively impact the economic outlook, as there is an acceleration in the labour market and growth.

(Source: ANSA)

• Oil prices rose on Monday as tensions between Russia and the West ratcheted up, adding to supply concerns that have kept oil prices near $100 a barrel. Brent crude futures jumped $1.23, or 1.3%, to $94.77 a barrel by 1300 GMT. U.S. West Texas Intermediate (WTI) crude futures rose $1.13, or 1.2%, to $92.20 a barrel. 
• Russian forces killed a group of five saboteurs who breached the country's southwest border from Ukraine on Monday, news agencies quoted the military as saying, an accusation that Ukraine called fake news. 
• Ministers of Arab oil-producing countries said on Sunday that OPEC+ should stick to its current agreement to add 400,000 barrels per day (BPD) of oil output each month, rejecting calls to pump more to ease pressure on prices. 
• Price gains have been limited by the possibility of more than 1 million BPD of Iranian crude returning to the market. Analysts said the market remained tight and any addition of oil would help, but prices would remain volatile in the near term because Iranian crude was unlikely to return until later this year. 
• Commonwealth Bank analyst Vivek Dhar has said that if a Russian invasion takes place, as the U.S. and UK have warned in recent days, Brent futures could spike above $100/bbl, even if an Iranian deal is reached.

(Source: Reuters)

• A senior Bank of England official has said that requiring regulators to keep the financial sector globally competitive following Brexit must not bring back the damaging booms and busts of the past. 
• Britain's finance ministry has said it will add a formal objective for the central bank and the Financial Conduct Authority to support financial sector competitiveness and long-term economic growth, without damaging their ability to keep firms and markets safe or protect consumers. 
• The financial sector specialists say London will remain a global financial centre after it was largely cut off from the European Union following Britain's departure. Critics warn of a return to the 'light touch' regime that ended with taxpayers bailing out banks in the financial crisis over a decade ago. 
• The BoE will consult around mid-year on implementing changes once the government has set out its plans. The new competitiveness objective could also influence other reforms such as implementing new global bank capital rules and making Britain's wholesale capital market more attractive to global investors.

(Source: Reuters)

• Jamaica’s economy grew by an estimated 6% year over year for the October to December 2021 quarter on the back of a 7.8% and 0.4% increase in the Services and Goods Producing Industries, respectively, the Planning Institute of Jamaica (PIOJ) reported. 
• The outturn also represents the third consecutive quarter of growth recorded, indicating that Jamaica’s recovery from the economic fallout from the COVID-19 pandemic, is well under way. 
• The growth largely reflected the continued relaxation of COVID-19 containment measures globally and locally, which facilitated increased domestic and external demand, resulting in a general uptick in economic activities. 
• All five services industry subsectors recorded growth, led by the Hotels and Restaurants sector, with an estimated 76.2% increase. The sector’s performance was largely spurred by a 186.3% increase in stopover visitor arrivals and 32,719 cruise passengers relative to none in the corresponding period of 2020.
• Real GDP is projected to grow within the range of 5.0% to 7.0% during January– March 2022 supported by continued positive effects of the easing of previously implemented COVID-19 containment measures in the domestic economy. Demand for tourism services is also expected to improve as citizens in key source markets expend pent-up demand as the effects of the omicron variant dissipates, thereby supporting growth. Additionally, higher employment levels should result in increased domestic demand auguring well for economic activity. 
• The main downside risks to this outlook includes: plant down-time due to relatively aged plant equipment in major industries; adverse weather conditions; slower than anticipated growth in the global economy due in part to the impact of the Coronavirus on trade; and rising geopolitical tensions between Russia and the Ukraine.

(Source: PIOJ)

• The reopening of the Bahamas tourism market accounted for 13% of the nation’s pre COVID-19 visitor base. Canada’s decision to drop its advisory against “non-essential” travel and ease border restrictions, which takes effect at the end of February, will pave the way for The Bahamas’ second largest source market to properly visit this country once again. 
• The move by Canada, which comes days after the United Kingdom (UK) removed its own COVID-related restrictions on overseas travel by its citizens, immediately gives The Bahamas access to its two most important source markets after the US, following a near two-year period of travel bans and general disruption. 
• President of the Bahamas Hotel and Tourism Association’s (BHTA), Robert Sands, elucidated that these “may be the first of many dominos that are going to be falling in source markets to improve tourist inflows to the island”. 
• Additionally, with the Omicron-induced case surge continuing to dissipate, this is a strong justification for the US health authorities to upgrade The Bahamas from a ‘Level 4’ “avoid travel” advisory to as high as ‘Level 2’ “moderate risk”. 
• Given that the tourism sector is a main contributor to export earnings, employment and economic growth in Bahamas, the resumption of travelers to The Bahamas, will aid in the country’s economic recovery. The country is expected to grow by 8.0% in 2022 (IMF).

(Source: The Tribune)

• Oil prices fell about 2.0% on Thursday as talks to resurrect a nuclear deal with Iran entered their final stages and could unlock more crude supplies, but losses were limited by tension between top energy exporter Russia and the West over Ukraine. 
• Brent futures fell $1.84, or 1.9%, to settle at $92.97 a barrel, while U.S. West Texas Intermediate (WTI) crude fell $1.90, or 2.0%, to settle at $91.76. Both benchmarks rose to their highest levels since September 2014 earlier in the week and both continue to face extreme backwardation in coming months. Backwardation is a market structure where prompt contracts are more expensive than those for later dates, indicating supply tightness. 
• Craig Erlam, market analyst at OANDA has said that the price could already be in triple-figure territory if not for the nuclear talks between the U.S. and Iran, noting that a deal could mean around 1.3Mn barrels per day (bpd) of crude quickly re-entering the market.

(Source: Reuters)

• Declines in bonds and stocks are sending investors into defensive products such as credit swaps, convertibles and even cash as they seek refuge from the market’s recent gyrations. 
• BlackRock Inc's iShares iBoxx $ Investment Grade Corporate Bond ETF has fallen by nearly 7% year-to-date to its lowest level since April 2020, as expectations of higher interest rates and persistent inflation dim the allure of bonds across the fixed-income spectrum. That is in line with losses across major stock indexes, which have also been hit by worries of tighter Fed policy. The S&P 500 has dropped 7.3% year-to-date and the Nasdaq Composite is down by about 11%. 
• The side-by-side tumbles have dealt another blow to a decades-old strategy that relied on a mix of bonds and stocks to take the sting out of equity declines, with bond prices ideally moving higher during periods of stock market volatility. 
• The search for defensive products comes amid worries of more volatility across asset markets, as an expected 150-175 basis points in rate increases over the next year threatens to further buoy bond yields and weigh on stock valuations. 
• For some investors, anticipation of more wild swings in asset prices has heightened the appeal of credit swaps, which are used to insure against the risk of corporate defaults.

(Source: Reuters)