• The U.S. services sector slowed to a nine-month low in March, backing expectations that economic growth likely stalled in the first quarter amid uncertainty caused by import tariffs. The economic outlook was further dimmed by President Donald Trump unveiling on Wednesday a 10% minimum tariff on most goods imported into the U.S., sparking threats of retaliation and rattling global financial markets.
• Fitch Ratings estimated the nation's tariff rate was now the highest in more than a century. Economists warned of higher inflation and possible job losses as households slash spending and businesses pull back on investment, potentially pushing the economy into recession. Business and consumer sentiment had already tanked before Trump's sweeping tariffs.
• Ten industries, including wholesale trade, public administration as well as construction and retail trade, reported growth. Among those reporting contractions were information, educational services and healthcare and social assistance.
• Comments from businesses were downbeat. Some construction businesses said they were already seeing the effects of import duties on aluminum imposed by Trump in March, adding that "these costs will be passed on to customers."
• Tariffs were also a problem for information businesses, while utilities companies said they expected "price increases in the near future due to tariffs." Public administration firms said deep government spending cuts and mass firings of federal workers were "negatively impacting our operations."
• Trump sees tariffs as a tool to raise revenue to offset promised tax cuts and to revive a long-declining U.S. industrial base, a view not shared by economists. But economists worry that Trump's tariffs blitz since returning to the White House in January could push the economy into recession, especially if the nation's trade partners retaliate with duties of their own.

(Source: Reuters)

• Federal Reserve Governor Lisa Cook said on Thursday that the central bank can take its time to assess a highly unsettled environment before moving interest rates again, amid risks that inflation could worsen due to tariffs. “Amid growing uncertainty and risks to both sides of our dual mandate, I believe it will be appropriate to maintain the policy rate at its current level while continuing to vigilantly monitor developments that could change the outlook,” Cook said in a speech at the University of Pittsburgh.
• During her remarks, Cook warned that tariffs have created risks for price pressures. “Inflation progress will stall in the near term, in part because of tariffs and other policy changes,” she said, adding “I currently place more weight on scenarios where risks are skewed to the upside for inflation and to the downside for growth,” while noting higher inflation and slower growth “could pose challenges for monetary policy.”
• A wide range of economists recoiled from his actions, which exceeded many forecasters’ worst-case scenarios, while financial markets around the world saw big sell-offs amid souring sentiment over the outlook. The tariffs, which are import taxes paid by Americans rather than foreign producers, will likely drive up already high levels of inflation and depress growth, and could even drive the U.S. and other nations into economic downturns, many analysts say.
• Economists share the concern over the impact of tariffs. "The implied U.S. tariff rate now stands near levels higher than during the Great Depression and last seen in the early 1900s," Deutsche Bank economists said on Thursday. Morgan Stanley forecasters said “risks to inflation lie to the upside,” adding “we think tariff-induced inflation will keep the Fed on the sidelines and we remove our June rate cut."
• Trump’s global trade war has put the Fed in a difficult position. Higher inflation argues for officials to hold steady or even potentially hike interest rates, while a weakening economy and souring job market could call for easier policy. Some in markets believe the challenging outlook makes it more likely the Fed could cut rates to try to limit the collateral damage of the president’s actions.

(Source: Reuters)

• Fitch Solutions expects the Jamaican economy to grow by 1.2% in 2025, buoyed by increased domestic demand and continued economic recovery from Hurricane Beryl.
• Additionally, Fitch sees favourable domestic economic conditions and expected policy rate cuts by the Bank of Jamaica (BOJ) in H2 2025 as auguring well for growth in economic activity. The outlook is also supported by a record-low unemployment rate of 3.5% in Q4 2024, well-anchored inflation rates within the BOJ’s target range, and an expected 6.7% minimum wage increase and rise in the income tax threshold from J$1.7Mn to J$1.8Mn in April 2025.
• Although domestic demand will help growth recover in 2025, Jamaica remains vulnerable to external shocks and challenging global economic conditions. These external factors include flagging U.S. demand, an unpredictable geopolitical and trade policy environment, and a potentially damaging hurricane season.
• A stagnating growth outlook for the United States is a stiff headwind to Jamaica’s economy. Fitch revised its forecast for Real GDP growth in the United States in 2025 down from 2.1% to 1.9% with risks tilted overwhelmingly to the downside. The impact of a slowing US economy is sizeable for Jamaica’s entire economy, with the United States accounting for 47.2% of Jamaica’s total exports in 2023 and 40.9% of total importsFurthermore, with the U.S. now imposing a 10% tariff on Jamaica (and other countries) for all imported goods, this is likely to put a damper on the island's exports to the US and, by extension GDP growth.
• Additionally, slowing economic activity in the United States will weigh on capital spending in Jamaica, as evidenced by sharp declines in foreign direct investment inflows in 2024. Demand for foreign travel by U.S. residents has also declined, with a 2.8 percentage point decrease in the percentage of Americans surveyed in February 2025 who said they planned to visit a foreign country in the next six months, a headwind for the tourism-dependent Jamaica.
• Fitch’s growth forecast also accounts for anticipated weather-related shocks curtailing economic growth and dynamism. An initial forecast for the 2025 storm season anticipates between 13 and 18 storms, including 7-10 hurricanes, comparable to 2024’s busy storm season, which saw 11 hurricanes and 18 storms. As seen in 2024, strong storms and hurricanes can dramatically impact Jamaica’s growth prospects through supply-side shocks, with resulting spikes in inflation deteriorating the real income of the Jamaican consumer and reducing the stock of productive capital and infrastructure.

(Sources: Fitch Connect & NCBCM Research)

• The Port Authority of Jamaica (PAJ) is investing billions of dollars in the expansion of shipping, logistics, and supply chain capacity in St. James. Senior Vice President of Finance, Information Services, Corporate Planning and Materials Management, Elva Williams-Richards, said that three major projects are being undertaken in the parish. These include the expansion of berth facilities at the Montego Bay Port at a cost of J$1Bn.
• The works, which are already underway, aim to improve efficiency for cruise and cargo operations. In addition, the Authority will be redesigning and scraping a section of Tony Hart Boulevard, the first phase of which will cost more than half a billion dollars.
• “These investments enhance the region’s capacity for trade, shipping and logistics, making western Jamaica a more attractive hub for international commerce and supports Jamaica’s goal of becoming a key player in the global supply chain,” she said.
• Importantly, on March 14, 2025, Caribbean Information and Credit Rating Services Limited (CariCRIS) reaffirmed the assigned Issuer/Corporate credit ratings of CariA- (Foreign Currency Rating) and CariA (Local Currency Rating) on the regional rating scale, and jmAA+ on the Jamaica national scale assigned to PAJ. The ratings indicate that the level of creditworthiness of PAJ relative to other obligors in the Caribbean is good, and when compared to other obligors in Jamaica, is high.
• CariCRIS also assigned a stable outlook on PAJ, reflecting the high likelihood that PAJ will continue to have profitable operations over the next 12-15 months.
• This affirmation and stable outlook could enhance the PAJ’s access to funding, which could be used within the business for further expansions. This, coupled with the expectation of improved revenue-generating capabilities based on the number of ongoing upgrade projects, supported by growth conditions in the Jamaican economy, global trade volumes and the global cruise industry, would act as a positive growth driver to the domestic maritime sector and the wider economy.

(Sources: JIS & CariCRIS)

• Guyana and Brazil will continue to play a dominant role in Latin America’s oil production growth by 2030, according to Norway-based energy research and business intelligence firm, Rystad Energy. 
• The region is set to add over four million barrels per day (mbd) of new crude oil and condensate capacity, accounting for 39% of global non-OPEC (Organization of the Petroleum Exporting Countries) additions.
• Guyana ranks as the 5th largest crude oil exporter in Latin America. Brazil has historically led production, but Guyana has emerged as a key contributor since production began at the Stabroek Block. By 2030, more than 85% of Latin America’s new offshore deepwater output will come from Guyana and Brazil, Rystad Energy said in an April 1 report.
• Major offshore oil developments across Latin America are poised to drive significant production growth in the coming years. Key projects include Brazil’s Búzios and Bacalhau fields, as well as ExxonMobil-led developments in Guyana such as Uaru, Whiptail, and Yellowtail. Notably, the Yellowtail project is expected to begin producing oil as early as the third quarter. Suriname’s GranMourgu project is slated to come online by 2028, adding a new frontier to the region’s energy landscape. Meanwhile, Mexico is gearing up to boost output through the Zama, Trion, and Polok-Chinwol fields. These developments underscore the region’s emerging role in global energy supply amid broader shifts in exploration and production strategies.
• According to Rystad Energy, global non-OPEC production capacity is expected to rise by 10.5 mbd between 2025 and 2030 but declines in mature fields will offset some gains. Latin America will see the highest growth at 1.9 mbd, outpacing North America, the Middle East, and Africa.
• Strong project approvals and a solid development pipeline will keep Latin America at the forefront of global supply expansion through the decade.

(Source: Oil Now)

• First Quantum Minerals' shares rose by as much as 3.0% on the Toronto Stock Exchange early on Tuesday after the company said it had discontinued arbitration proceedings against the Panama government.
• The decision, announced on Monday, raises the prospect of negotiations to resume production at the Cobre Panama copper mine, which had contributed 1% of global copper production until the government of Panama shut it down following public protests in 2023.
• The suspension of output impacted both Panama's and the company's financial prospects. The next steps in the dispute depend on the actions of Panama's president. In addition to First Quantum, at least five other companies have filed arbitration cases against Panama over the closure of the Cobre Panama mine.
• First Quantum’s suspension of arbitration offers the Panamanian government a chance to renegotiate and potentially restart operations at the Cobre Panama mine—an economically critical project.
• The resumption of mining operations now appears increasingly likely, especially following President Mulino’s confirmation that formal negotiations would begin once arbitration proceedings were withdrawn. Nevertheless, significant resistance is expected from environmental groups and indigenous communities residing in the remote region where the mine is located, potentially complicating the path forward.
• Lilian González Guevara, executive director of the non-governmental Environmental Incident Center, pushed back against the economic argument for reopening the mine. She said that while many countries had struggled economically recently, Panama had grown even without the mine operating last year. “We haven’t depended on mining, it’s a fallacy,” she said. The only dialogue the group was open to having was about permanently closing the mine.

(Sources: Reuters and NCBCM Research)

• President Donald Trump's new tariffs announced on Wednesday sent shockwaves through global markets amid worries the aggressive duties will slow growth, hit corporate earnings and stoke inflation.
• Global markets have been whiplashed since Trump took office and kept up a stream of rhetoric that threatened to unleash a global trade war. Trump's new levies crystallised those fears.
• He set a baseline of 10% across all imports and higher duties on some of the U.S.’s biggest trading partners. Taken together, the duties will erect new barriers around the world's largest consumer economy, reversing decades of trade liberalization that have shaped the global order following World War Two.
• In interviews, several investors and analysts said the rhetoric around tariffs had already caused an economic slowdown, hitting both consumer and corporate confidence. The big unknown now is how trading partners will react, they said.
• While Wednesday’s announcement provided a baseline, it is likely to be followed by months of negotiations and debilitating uncertainty. Jay Hatfield, CEO at Infrastructure Capital Advisors, spoke bluntly of the impact. "This is the worst-case scenario that the market was expecting, and that's enough to potentially send the U.S. into a recession" he said.
• Analysts expect trading partners to respond with countermeasures that could lead to dramatically higher prices for everything from bicycles to wine and how the market ultimately digests what is being done right now. Notably, China urged the United States to immediately cancel its latest tariffs and vowed countermeasures to safeguard its own interests
• "The tariffs are so comprehensive and so much larger than we expected. People were talking earlier about whether clarity would boost the market. But now you have clarity, and no one likes what they see," said Jeanette Garretty, chief economist at Robertson Stephens.

(Source: Reuters)

• Britain's business secretary vowed to "remain calm" and insisted he still wants a trade deal with the United States after President Donald Trump's decision on Wednesday to impose import tariffs of 10% on the United Kingdom.
• Trump said Britain would be among the countries that would face the new lowest tariff rate on imports to the United States, while dozens of other nations faced higher duties. Britain has been attempting to reach an economic deal with the U.S. by offering to more closely align with Washington on areas such as technology and has expressed hope that any tariffs can be reversed quickly once the two sides agree on terms.
• "The US is our closest ally, so our approach is to remain calm and committed to doing this deal, which we hope will mitigate the impact of what has been announced today," Business Secretary Jonathan Reynolds said in a statement after the tariffs were announced.
• Unlike the European Union and other major economies, Britain has not retaliated over other U.S. tariffs but has said that it would keep all options on the table. British business groups welcomed the government's approach, saying that while they were deeply disappointed by the tariffs, retaliating would only cause further economic disruption. "A cool and calm reaction from the UK Government is the right response: UK firms need a measured and proportionate approach which avoids further escalation," Rain Newton-Smith, the chief executive of the Confederation of British Industry, said in a statement.
• Britain's opposition Conservative Party blamed the Labour government for failing to negotiate an exemption from the tariffs, while the Liberal Democrats accused the U.S. of launching a "destructive trade war".

(Source: Reuters)

• The Jamaican economy contracted by 0.8% in the fourth quarter of 2024 (Q4 2024) compared to Q4 2023, these are the findings in the latest release from the Statistical Institute of Jamaica (STATIN). The year over year decline in economic activity was due to the impact of Tropical Storm Rafael in November and the lingering effects of Hurricane Beryl. This marked the second consecutive quarterly decline for 2024,
• Despite a 0.4% increase in the Services Industries, the Goods Producing Industries declined by 4.3%, resulting in the overall falloff in real value added. All Goods Producing Industries experienced declines, with Agriculture, Forestry & Fishing contracting the most (-10.6%), followed by Construction (-2.7%), Mining & Quarrying (-2.3%), and Manufacturing (-0.5%). The decline in Agriculture, Forestry & Fishing was observed in both the Traditional Export Crops and Other Agricultural Crops (including Animal Farming, Forestry & Fishing) sub-industries, which fell by 46.3% and 4.1%, respectively.
• The effects of Hurricane Beryl, compounded by heavy rains from Tropical Storm Rafael in November 2024, drove the sharp contraction in the Agricultural industry. The Ministry of Agriculture estimated total crop, livestock, and infrastructure damages at J$621Mn.
• Meanwhile, growth in the Services Industries was primarily attributed to increases in Producers of Government Services (0.8%), Wholesale & Retail Trade; Repairs; Installation of Machinery & Equipment (0.2%), Transport, Storage & Communication (1.8%), Other Services (0.2%), and Finance & Insurance Services (0.5%). However, the growth was tempered by the declines in Electricity & Water Supply (-1.4%), Real Estate, Renting & Business Activities (-0.3%), Hotels & Restaurants (-0.3%), Other Services (-0.2%) and Finance & Insurance Services (-0.5%).
• Overall, preliminary estimates for the calendar year 2024 indicate that total value added at constant prices fell by 0.7% compared to 2023. However, looking ahead, there are signs that the economy could expand in 2025, with the PIOJ projecting a 0.1% to 1.0% increase for the March quarter.
• That said, there are risks to the outlook. The uncertainties around the Trump administration's trade, immigration and other policy changes could adversely affect remittances, exports, and tourist activity if they weaken U.S. consumer confidence through higher inflation and increased uncertainty. These developments could lead to a reduction in Jamaica’s current account balance while also affecting demand for the sovereign’s goods and services, given the likelihood of lower household income due to lower remittance inflows. Overall, lower demand would dampen economic growth and could lead to further local economic contraction

(Sources: STATIN & NCBCM Research)

• The Kingston Airport Revenue Finance LLC (KINAIR) project is expected to continue to withstand a hypothetical sovereign stress scenario attributable to its financial structure, which includes an offshore cash-funded reserve account and relatively steady air passenger volumes, given the airport's importance for Jamaica.
• In 2024, Norman Manley International Airport's traffic performance (1.76 million passengers) was in line with S&P Global Ratings' expectation of 1.75 million arrivals. Aeronautical charges were adjusted higher by 3.36% effective January 1, 2025.
• Importantly, total passengers at the airport rose 1.6% in 2024, with less than 1% of passengers being domestic passengers. International passengers were mainly traveling from the U.S. (primarily Fort Lauderdale, New York, and Miami), Canada, and the U.K.
• The three airlines that contributed most to the airport’s revenue in 2024 were JetBlue Airways Corporation, American Airlines Inc., and Caribbean Airlines Ltd. Together, they accounted for roughly 45% of the airport's airline-related revenue.
• For these reasons, S&P believes passenger traffic at the NMIA will grow 4%-6% in 2025 and 3%-5% in 2026. This will enable KINAIR, which benefits from 53.22% of the airport’s revenue and is intrinsically correlated to traffic volumes, to post the minimum and median DSCRs (debt service coverage ratios) during the first phase of the transaction of roughly 1.28x and roughly 1.3x, respectively, until an expected refinancing in 2036. For the second phase, S&P continues to expect minimum and median DSCRs of 1.3x.
• Kingston’s NMIA is owned by the Airports Authority of Jamaica. The authority operated the NMIA for about 45 years, but in 2019, it granted a 25-year concession to Grupo Aeroportuario del Pacifico S.A.B. de C.V. (GAP), a private airport operator. As part of the agreement, GAP committed to the monthly transfer of 53.22% of the airport's aggregate revenue (consisting of aeronautical and commercial revenue) as the concession fee to the Airports Authority of Jamaica. The remaining 46.78% of revenue must cover NMIA's operations, maintenance costs, and capital expenditures. The concession fee is, therefore, senior to any of the airport's expenses.

(Source: S&P Global Ratings)