• Mexico's economy is seen growing between 2.5% and 3.5% this year and then expanding 2.0% to 3.0% in 2025, a draft budget from the country's finance ministry showed on Wednesday.

• Inflation in Latin America's second-biggest economy is expected to tick down to 3.8% this year, according to the draft, essentially meeting the central bank's target of 3%, plus or minus one percentage point. The expected 2024 inflation rate would also signal a slowdown from the 4.40% annualised growth rate in consumer prices in February.

• For 2025, the draft budget predicts that inflation will further ease to 3.3%. The document, which is used by lawmakers to plan future spending, also sees Mexico's peso trading at 17.8 pesos per dollar this year, and slightly weakening to 18.0 versus the U.S. currency next year.

• Average crude oil production this year is forecast at 1.85Mn barrels per day (bpd), rising slightly to 1.86Mn bpd in 2025. While the draft budget said the estimates refer to crude volumes, the government generally combines crude with condensate liquids in its figures.

• Official data shows that state-owned oil company Pemex pumped an average of 1.55Mn bpd of crude in February, its lowest level since 1979. Pemex's oil output, the sales of which are a major contributor to public finances, has been on a steady decline from its peak of 3.4Mn bpd two decades ago. Meanwhile, crude exports are expected to reach 967,600 bpd this year and drop to 958,400 bpd next year.

(Source: Reuters)

• U.S. banks could see a modest hit to their earnings due to the US$30.0Bn settlement to limit credit and debit card fees for merchants by payments networks Visa and Mastercard, Wall Street analysts said.

• The antitrust settlement announced on Tuesday is one of the largest in U.S. history. If approved by the court, it would resolve most claims in a nationwide litigation that began nearly two decades ago.

• Brokerage Evercore ISI said the move to reduce and cap interchange fees impacts issuing banks that generate revenue through the charges and will not be financially material to Visa and Mastercard. "The removal of anti-steering restrictions and by enabling competitive pricing, we could see merchants encouraging more cash transactions or cheaper debit transactions," it said.

• As part of the settlement terms, Visa and Mastercard have agreed to reduce swipe rates by at least four basis points - 0.04 percentage points - for three years and ensure an average rate that is seven basis points below the current average for five years.

• Wall Street analysts expect banks to absorb a large part of the revenue loss by sharing the impact with both card networks and trimming reward expenses.

(Source: Reuters)

• China's industrial firms posted higher profits in the opening months of the year, official data showed on Wednesday, reinforcing signs that an economic recovery was gaining traction, despite persistent sluggishness in the property sector.

• Profits at China's industrial firms jumped 10.2% in the first two months from a year earlier, National Bureau of Statistics (NBS) data showed, following a 2.3% profit decline for the whole of 2023.

• The surge comes on the heels of upbeat indicators earlier this month that suggest a stabilisation in Asia's largest economy. Overall gains remain tempered by the persistent fragility in China's property market, pointing to a divergence in the country's post-pandemic recovery.

• "After an upside surprise to industrial production to start the year, a further recovery of industrial profits sends another signal that we are indeed seeing a gradual recovery after a bottoming out last year," said Lynn Song, chief economist for Greater China at ING. "If the recovery of manufacturing continues, it would contribute toward reaching the 2024 growth target, but more supportive policies are still needed to sustain the momentum and recovery."

• State-owned firms recorded a 0.5% rise in earnings in January-February, foreign firms saw a 31.2% gain, while private-sector companies booked a 12.7% increase, the data showed.

• Zhou Maohua, an analyst at China Everbright Bank, expects continued gains in industrial earnings, but said their prospects could be dented by an uncertain global demand outlook, fluctuations in energy and other commodities prices and supply chain disruptions from geopolitical conflicts.

(Source: Reuters)

• Sygnus Credit Investments Limited (SCI) has advised that the company repurchased 2,400,000 JMD Ordinary shares on March 19, 2024, under the Company’s Share Buy-Back Programme.
• In a note to the Jamaica Stock Exchange (JSE), SCI advised that the purpose of the purchase was to enhance shareholder value and that the maximum intended repurchase is up to US$9Mn of SCI’s JMD and USD ordinary shares.
• The actual amount repurchased as at March 21 is a total of 136,525 USD Ordinary Shares and 4,878,274 JMD Ordinary Shares, equivalent to approximately US$433,000.00. This is inclusive of the units previously repurchased in June 2023.
• The company also noted that the source of funding for the purchase was the company’s cash flows, and the shares were purchased on the open market via its brokers.
• When a company buys back its shares from the stock market, it reduces the number of outstanding shares. Each shareholder of the remaining shares gets a larger portion of dividends paid and ultimately owns a greater stake in the company. Additionally, earnings per share (EPS) and return on equity (ROE) tend to rise, which may attract more investors, and given the increased scarcity of shares, this could drive up demand and potentially lead to an increase in the share price.

(Sources: JSE and NCBCM Research)

• Guyana has issued a call for international legislators to denounce Venezuela’s recent actions aimed at asserting control over the Essequibo region, a significant portion of the Caribbean Community (CARICOM) nation.
• Anil Nandlall, the Attorney General and Minister of Legal Affair underscored the imperative for parliamentary bodies worldwide to address Venezuela’s actions, stressing the importance of upholding international law and fostering diplomatic avenues for resolving conflicts.
• He emphasised that such condemnation is not merely a gesture of support to Guyana but a fundamental obligation in line with the principles of the Inter-Parliamentary Union (IPU) Assembly.
• Despite diplomatic efforts and interim measures imposed by the International Court of Justice (ICJ), Nandlall expressed concern over Venezuela’s recent legislative actions to annex a significant portion of Guyana’s territory.
• This move, he asserted, constitutes a breach of both legal obligations and the spirit of diplomatic agreements, further exacerbating tensions between the two nations.

(Source: Caribbean News Weekly)

• Brazil's central government reported a sharp deterioration of its budget in February. Treasury data showed that increased revenues were unable to offset the negative impacts of a significant growth in expenses.
• The central government's primary budget deficit reached 58.4 billion reais ($11.7Bn) in February, a 37.7% surge in real terms over the same month a year ago. Total spending expanded by 27.4% over February 2023, to 190.9Bn reais, mainly influenced by 30.1 billion reais in court-ordered debt payments, said the Treasury.
• Treasury Secretary Rogerio Ceron said that court-ordered debts are typically paid in May or June, and the decision to anticipate them distorted the comparison with total expenditures from February last year.
• Meanwhile, net revenue increased by 23.4% from the same month a year ago, to 132.5 billion reais. The government had already said that tax revenue for February had been a record for the month, helped by the taxation of closed-end funds and the reinstatement of federal taxes on fuels.
• The government is relying on a revenue boost to erase the primary deficit this year, a goal that is still viewed with skepticism by the market. Last week, the Planning and Finance ministries worsened their projection for public accounts, but still kept it in line with the target of a primary deficit equivalent to 0% of gross domestic product (GDP).
• The market, in turn estimates that the deficit will reach 0.75% of GDP, according to a central bank weekly survey. Year-to-date, the central government recorded a primary surplus of 20.9Bn reais, smaller than the 38.3 billion reais surplus from a year ago, fundamentally affected by higher spending.
• By mid-April, the government is expected to submit to Congress the fiscal target for next year, after indicating it would pursue a primary surplus of 0.5% of GDP in 2025 and 1% of GDP in 2026.

(Source: Reuters)

• Bank of England policymaker Catherine Mann, who last week dropped her call for increases in borrowing costs, said on Tuesday she thought markets were betting on too many interest rate cuts by the British central bank.
• "I think they're pricing in too many cuts, that would be my personal view," Mann told Bloomberg TV, referring to financial markets, which are almost fully predicting three quarter-point reductions in rates by the BoE this year.
• She further stated that there has been a substantial easing even since the vote last week and that perhaps markets are a bit too complacent about how long they think the BoE, overall the MPC, will hold rates.
• Last week, she joined the majority of the Monetary Policy Committee's (MPC) members who kept the Bank Rate at 5.25%, its highest since 2008. She had previously voted for an increase to 5.5%.
• However, Mann said she changed her mind due to consumers’ reluctance to pay higher prices, especially for services such as hospitality and travel, and because firms were cutting hours of workers at a time when the government's cuts to social security rates would add to the number of workers in the labour market.
• Finally, she opined that pricing in financial markets was helping the BoE do its work for it. "In some sense, I don't have to cut because the market already is, in terms of the implications of you know the market curve and mortgage rates, for example," she said. "Those are the rates that are faced by borrowers. Bank Rate is not the rates that borrowers face."

(Source: Reuters)

• As Europe seeks to hold its ground against economic rivals, politicians think they have a secret weapon: the untapped savings of its citizens.
• From Italy selling government bonds to households, to French talk of a pan-European savings product or Britain offering tax breaks for investment in UK shares, governments across Europe are seeking ways to mobilise household wealth. All these plans share an underlying thinking: Europe is sitting on plenty of cash that could be channelled towards its goals, from the green transition to beefing up militaries.
• Politicians hope private money invested in local stocks or government debt can help close the growth and productivity gap with the United States and China. However, critics say such schemes risk disappointing savers, while failing to address deep-rooted shortcomings in the European economic model that they see as dissuading investment.
• European governments, led by figures like French Finance Minister Bruno Le Maire, are exploring various strategies to mobilize idle savings for economic growth, including proposals for pan-European savings products and directing savings towards domestic defense companies. However, critics argue that the concept of "dormant money" in bank accounts is flawed, pointing out that banks can readily deploy deposits for loans.
• Despite efforts to encourage investment, data suggests that Italians investing in government-sponsored funds targeting local small-to-medium-sized enterprises (SMSEs) have underperformed global stocks significantly over the past five years. Some economists believe that the real issue hindering investment in Europe is not funding availability but rather meager growth prospects compared to other regions like the United States.

(Source: Reuters)

• Wigton Windfarm Limited (WIG) has advised that Mr. Earlington Barrett, Managing Director of WIG, will be demitting office effective March 31, 2024. The process of recruiting a new Managing Director is underway.
•  Interim measures for the continued leadership and operational oversight of the business have been implemented, and Miss Michelle Chin Lenn, the current Head of Energy of WIG, will serve as Acting Managing Director until the aforementioned recruitment process is completed.
• Wigton’s stock price has increased by 53.4% since the start of the calendar year. The stock closed Monday’s trading session at $1.12 and trades at a P/E of 38.6x which is above the Main Market Energy, Industrials and Materials Sector Average of 16.1x.

 (Sources: JSE and NCBCM Research)

• Acting Prime Minister Chester Cooper has urged the Grand Bahamian business community to “get in the game” and not let economic opportunities pass them by, claiming that investor confidence in Grand Bahama has never been higher.
• Speaking at the Grand Bahama Chamber of Commerce’s (GBCC) annual installation of officer and directors banquet on Saturday, Cooper highlighted Carnival Cruise Line’s Celebration Key project, a $600Mn investment set to be the largest cruise project globally.
• “The projections are staggering; visitor arrivals in Grand Bahama are expected to exceed 1.4Mn by the end of 2025, reaching up to 4Mn annually by 2027. This not only represents a significant boost in tourism but also heralds a new era of job creation, revenue generation, and overall economic impact for our island. The investments don’t end there, and they are real. Real in tourism, but also real in the maritime and industrial sectors. Additionally, investor confidence in Grand Bahama has never been higher.”
• He urged the GBCC and its members to “engage, get in the game, and mobilize more organic, domestic investment.”
• “The revival of Grand Bahama’s economy must be a concerted effort, one that requires the hands-on engagement of the entire business community, in partnership with the government, GBPA, the Chamber, and all local stakeholders. Together, we have the power to encourage organic growth through Domestic Investments, drive sustainable economic growth to create opportunities for local entrepreneurship, and ensure that the benefits of the economic renaissance are widely shared and deeply rooted in the fabric of this community,” said Cooper.
• Finally, Cooper emphasised that the government fully expects Grand Bahama businesses to have the first crack at opportunities that become available and has also suggested that the cruise lines visiting Bahamian ports ought to temper the language in their onboard advisories.

(Source: Eye Witness News)