• Following the upgrade of Jamaica’s sovereign rating to 'BB' from 'BB-' with a positive outlook, S&P Global Ratings has subsequently raised the ratings of Kingston Airport Revenue Finance LLC (KingAir) and Montego Bay Airport Revenue Finance Ltd. (MoAir) to 'BB+' from 'BB', one notch above the sovereign rating.
• The ratings reflect the rating agency’s expectations that both entities are well-positioned to withstand sovereign stress, supported by strong financial structures, such as dollar-denominated revenues with no foreign exchange exposure, stable air passenger volumes, and offshore cash-funded reserve accounts.
• MoAir and KingAir’s ratings could be upgraded within the next 12 months if Jamaica’s sovereign rating is raised and the rating agency upgrades its Transfer & Convertibility (T&C) assessment to 'BBB-'. However, the ratings could be downgraded if traffic volumes decline, resulting in debt service coverage ratios (DSCRs) consistently falling below 1.2x for both entities.
• Meanwhile, S&P also upgraded Transjamaican Highway Ltd. to 'BB' from 'BB-'. The outlook is also positive. The project's regulated nature and limited capacity to withstand sovereign stress due to the dependence on tariff adjustments both factored into the rating. The rating on TJH is capped at the sovereign level due to its exposure to regulatory risks and dependence on local economic conditions.
• TJH’s positive outlook mirrors that of the sovereign, with the potential for an upgrade if S&P raises Jamaica’s rating, subject to continued strengthening of the country’s policy framework. However, the outlook could be revised to stable if the sovereign outlook is similarly revised.
• The projects’ Stand-Alone Credit Profile (SACP) could also be downgraded from 'a-' to 'bbb+' if financial performance, traffic volumes, or maintenance requirements significantly underperform expectations, resulting in a minimum DSCR of 1.7x or below. Furthermore, S&P may also lower the SACP if it downgrades the rating of National Commercial Bank Jamaica Ltd. (BB-/Stable/B), the project's bank account provider.

(Source: S&P Global Ratings)

• Real value added for the Jamaican economy rose by 1.6% in the second quarter of 2025 compared to the same period in 2024 according to the Statistical Institute of Jamaica (STATIN). This outturn is just 0.2% percentage points higher than the estimates done by the Planning Institute of Jamaica in August 2025. This increase was driven by growth in the Goods Producing and Services Industries, which expanded by 3.6% and 1.0%, respectively.
• Higher output in the Goods Producing Industries was due to improved performance in Agriculture, Forestry, & Fishing (+9.2%), Construction (+1.7%), and Manufacturing (+1.5%). The expansion in the Agriculture, Forestry, & Fishing industry marked the second quarterly increase in real value added from the sector for 2025, signalling the industry’s recovery from the impact of the adverse weather events of 2024. However, the Mining & Quarrying industry declined by 4.8%, which moderated overall economic activity.
• Growth in the following industries: Accommodation & Food Service Activities (+4.1%), Financial & Insurance Activities (+3.9%), Public Administration & Defence (+0.9%), Transport & Storage (+1.7%), Information & Communication (+0.2%) and Real Estate & Business Services (+0.2%) also supported an expansion in the services industry. However, the industry’s growth was tempered by declines in Electricity, Water Supply & Waste Management (-2.6%) and Education, Health & Other Services (-0.5%).
• The Wholesale & Retail Trade; Repairs; Installation of Machinery & Equipment industry remained relatively flat. The Accommodation & Food Service Activities industry was impacted by the continued increase in foreign national arrivals to the island, as well as increases in the food services activities group, which was largely impacted by the 2.7% increase in foreign national arrivals as well as a 5.1% rise in the average guest nights. The number of foreign national arrivals was 691,796 in 2025, up from 673,748 in 2024. There was also an improvement in the food services activities group, reflecting increased demand.
• Compared to the first quarter of 2025, the seasonally adjusted value added showed that the economy grew by 0.4%. This reflected a 2.3% increase in the Goods Producing Industries. However, the Services Industries declined by 0.2%.

(Source: STATIN)

• The Panama Canal said on Thursday that lawmakers in the Central American nation had approved the proposed budget for the key global freight channel for the 2025/26 fiscal year, which is expected to bring an increase in state contributions.
• For the October to September period, lawmakers backed a US$5.21Bn budget for the canal, which is expected to bring US$3.19Bn to state coffers, up 14.5% from the level set out in the prior year's budget, the canal authority said. Last week, the canal forecasted a US$3.5Bn profit for the fiscal year ending in September. The canal has said it expects less transits next year due to global economic instability.
• The now-approved budget includes provisions for some of the canal's planned investments, it added, including its plan to build a US$1.6Bn reservoir to expand the canal, a project that has been challenged in court by local communities.
• The Rio Indio reservoir project would displace some 2,500 people. A group representing farmers filed a lawsuit to Panama's Supreme Court, saying most residents do not want to leave and that the project violates the constitution.
• Building the reservoir would boost key supplies of water needed to transport cargo ships through a series of elevated locks, after a drought in 2023 caused the canal to reduce transits. Millions of gallons of water are needed per transit.
• Panama has faced pressure from Washington over the running of the canal, with the Trump administration pledging to "take back" the waterway from perceived influence from China. China and the United States compete for economic influence in the region, and the latter has been pushing countries in the Central American to limit the presence of Chinese companies.

(Source: Reuters)

• Trinidad and Tobago has received U.S. support to develop the Dragon gas field in Venezuela, and it could also include a license from the U.S. Treasury Department, both the U.S. government and Trinidad said on Tuesday. The announcement followed a meeting between Trinidad and Tobago Prime Minister Kamla Persad Bissessar and U.S. Secretary of State Marco Rubio in Washington.
• Trinidad and Tobago has wanted to develop gas resources in U.S.-sanctioned Venezuela near the two countries' maritime border, but the project was paused earlier this year after the initial U.S. licenses were suspended
• The U.S. in April revoked a license that permitted Shell and Trinidad's National Gas Company to develop the Dragon gas field off of Venezuela, despite sanctions targeting the government led by President Nicolas Maduro.
• The U.S. supports the Trinidad government’s Dragon gas proposal and steps to ensure it will not provide significant benefit to the Maduro regime, Rubio said in a statement on Tuesday.
• Shell's activities relating to Venezuela are conducted in strict adherence to all applicable laws, regulations and trade controls, including those of the U.S., the company told Reuters in response to the U.S and Trinidad and Tobago statements.

(Source: Reuters)

• U.S. job openings increased marginally in August while hiring declined, consistent with lacklustre labour market conditions that could allow the Federal Reserve (Fed) to cut interest rates again next month despite resilient consumer spending.
• Households are also growing pessimistic about the labour market. A survey from the Conference Board on Tuesday, September 30, 2025, showed the share of consumers viewing jobs as "plentiful" fell this month to the lowest level since early 2021. There were 0.98 job openings for every unemployed person in August, compared to 1.0 in July.
• The labour market has almost stagnated amid slowing demand for workers, with economists blaming a lagging drag from uncertainty stemming from tariffs on imports as well as the rise of artificial intelligence. An immigration crackdown has also reduced labour supply, creating what Fed Chair Jerome Powell has described as a "curious balance."
• Job openings, a measure of labour demand, rose 19,000 to 7.227 million by the last day of August, the Labour Department's Bureau of Labour Statistics said in its Job Openings and Labour Turnover Survey, or JOLTS report. Economists polled by Reuters had forecast 7.185 million unfilled jobs. Hiring decreased 114,000 to 5.126 million in August, concentrated in the trade, transportation and utilities industry. Accommodation and food services hiring also declined, likely the result of immigration raids that have led to deportations and kept fearful workers at home.
• The report could be the last key economic data for a while, given the current US government shutdown. The Labour and Commerce departments said on Monday that all data releases, including September's employment report due on Friday, would be suspended.
• Economists expect the Fed to put more emphasis on the labour market, though a government shutdown would leave policymakers without key data ahead of their October 28-29 meeting. "The Fed has a bias to cut unless the labour market shows signs of improvement, but the fog the central bank sets monetary policy in may get thicker because the partial federal government shutdown could delay the release of the September employment report," said Ryan Sweet, chief U.S. economist at Oxford Economics.

(Source: Reuters)

• U.S. President Donald Trump gave Hamas three to four days on Tuesday, September 30, 2025, to accept a U.S.-backed peace plan for Gaza, warning of "a very sad end" if the group rejected the proposal that he said was close to ending the two-year-old conflict.
• Mediators Qatar and Egypt shared the 20-point plan with Hamas late on Monday after Israeli Prime Minister Benjamin Netanyahu had appeared alongside Trump at the White House and endorsed the document, saying it satisfied Israel’s war aims.
• Hamas was not involved in the negotiations that led to the proposal, which calls on the Islamist militant group to disarm, a demand it has previously rejected. However, an official briefed on the talks told Reuters that the group "would review it in good faith and provide a response".
• Speaking to reporters in Washington, Trump said Israeli and Arab leaders had already endorsed the plan and that "we’re just waiting for Hamas" to make its decision. He gave the group "three or four days" to respond. "Hamas is either going to be doing it or not, and if it’s not, it’s going to be a very sad end," Trump said as he left the White House. Asked whether there was scope for further talks on the proposal, he replied: "Not much."
• The plan specifies an immediate ceasefire, an exchange of all hostages held by Hamas for Palestinian prisoners held by Israel, a staged Israeli withdrawal from Gaza, the disarmament of Hamas and the introduction of a transitional government led by an international body. Many elements of the 20 points have been included in numerous ceasefire deals proposed over the last two years, including those accepted and then subsequently rejected at various stages by both Israel and Hamas.
• One of Hamas’s main conditions since the outset of the war has been a full Israeli withdrawal from Gaza in return for the release of the remaining hostages. And while the group has indicated its readiness to relinquish administrative authority, it has consistently ruled out disarming. However, Hamas faces considerable pressure to accept the plan, with the foreign ministers of Saudi Arabia, Jordan, United Arab Emirates, Qatar and Egypt all welcoming the initiative.

(Source: Reuters)

• The Monetary Policy Committee (MPC) of the Bank of Jamaica (BOJ), at its meetings on the 25^th and 26^th of September 2025, unanimously agreed to hold the policy rate at 5.75% against the background of low domestic inflation amid global uncertainties. Despite broad market expectations for a reduction in the benchmark rate, the MPC determined that the current stance continues to be appropriate to support inflation converging to the target range.
• The decision to maintain the policy rate considers that while headline inflation of 1.2% as at August 2025 is below the Bank’s target range of 4.0 to 6.0%, core inflation continues to track within the target range. Moreover, the low headline inflation rate as at August 2025 is unrelated to demand conditions.
• The BOJ noted that the temporary factors that caused low headline inflation in August 2025 were primarily related to improvements in supply conditions. In particular, agricultural prices during the month were lower than a year earlier, when prices rose due to the negative impact of Hurricane Beryl on domestic crop production. Supplies improved subsequent to the adverse weather, leading to prices reverting to more normal levels. In addition, the dissipation of the impact of a previous adjustment in public transport fares, as well as a reduction in the General Consumption Tax (GCT) on electricity consumption announced by the Government in March 2025, contributed to lower-than-targeted inflation.
• Notwithstanding these temporary shocks, core inflation (which excludes the prices of agricultural food products and fuel from the Consumer Price Index (CPI)) was 4.2 percent in August 2025, remaining within the target range since March 2025. Recent developments suggest that headline inflation will continue to track below the lower limit of the Bank’s target range for the remainder of 2025 but should return to the target range by the March 2026 quarter. This upward trajectory will be driven by the anticipated dissipation of the temporary shocks. Core inflation is projected to remain within the target range over the next two years, consistent with stable inflation expectations and a growing economy.
• It was widely expected by economists and market analysts that the BOJ would lower its benchmark rate at this meeting, given that headline inflation has remained on a steady disinflationary path. Instead, the Bank opted to hold, citing concerns about core inflation, a metric that took centre stage in its decision for the first time in recent years. Of note, the BOJ’s formal target is based on headline inflation, not core, and the Bank has never published a target range for core inflation.
• While core inflation is often regarded as a more reliable gauge of underlying long-term price trends, effective monetary policy also depends on clarity. The absence of defined guidance on core inflation could leave the public without a clear anchor for expectations.
• That said, the BOJ noted that risks to the projected path for inflation over the next eight quarters are skewed to the upside (which means that inflation could be above projections). Higher inflation could stem from a sharper-than-anticipated increase in tariffs faced by the United States (US) trading partners, as well as related second-round effects. This could result in higher imported inflation and inflation expectations. Additionally, inflation could be higher than projected if there is further escalation in geopolitical tensions, which could negatively impact international supply chains. Lower inflation could, however, result from lower-than-projected international commodity prices as well as weaker demand conditions.
• The MPC noted that it would continue to monitor incoming data and will adjust its policy as needed when it meets again in November 2025.

(Sources: BOJ and NCBCM Research)

• Output prices for producers in the Mining and Quarrying industry, a component of the producers' price index (PPI), increased by 0.2% for August 2025, while the index for the Manufacturing industry declined by 0.1% according to the Statistical Institute of Jamaica (STATIN).
• The increase in the index for the Mining & Quarrying industry was primarily due to a similar 0.2% rise in the index for the major group ‘Bauxite Mining & Alumina Processing’.
• On the other hand, the decline in the PPI for the Manufacturing industry was due to a 1.4% decline in the major group ‘Refined Petroleum Products’. However, this decline was tempered by a 0.2% increase in the index for the major group ‘Food, Beverages & Tobacco.
• For the period August 2024 – August 2025, the point-to-point index for the Mining & Quarrying industry decreased by 6.6%. This was mainly due to a decline of 7.5% in the index for the major group ‘Bauxite Mining & Alumina Processing’.
• The point-to-point index for the Manufacturing industry increased by 1.9%. This was related to a 3.1% increase in the index for the major group ‘Food, Beverages & Tobacco. However, the industry’s overall increase was moderated by a 5.7% fall in the index for the major group ‘Refined Petroleum Products’ due to lower prices for crude on the international market.
• Looking ahead, a significant upside risk to the Producer Price Index (PPI) is posed by the potential for renewed geopolitical tensions to disrupt supply chains. Such a disruption would likely lead to a sharp acceleration in international oil prices, thereby immediately escalating imported input costs for domestic manufacturers and placing strong upward pressure on the Manufacturing index.

(Sources: STATIN & NCBCM Research)

• Brazil's central bank continues to see signs of resilience in the country's economy despite indications of an overall slowdown, its governor said on Monday, adding that the authority would maintain a data-driven approach to monetary policy.
• Gabriel Galipolo's remarks came as the bank earlier this month held interest rates at a near two-decade high of 15.0% for a second straight meeting, signaling it would keep them unchanged for a long time in a bid to tame persistent inflation.
• Speaking at an event hosted by Itau BBA, Galipolo emphasised that the central bank is monitoring whether interest rates are at a sufficiently restrictive level to bring inflation back to its 3.0% target. He noted that Brazil's job market has demonstrated "great resilience, while a current account deficit points to heated demand.
• He mentioned that both the bank's own projections and the expectations of various economic agents suggest that inflation will remain above the goal over the relevant horizon, which currently extends to the first quarter of 2027.
• Galipolo also pointed out that current inflation is above target, adding that all these variables "require us to remain vigilant, calm, and persistent." Even so, the governor said that the bank's data-dependent approach has proven effective so far.

(Source: Reuters)

• The United Kingdom’s (UK) government is considering stricter criteria for permanent residency, reflecting growing political pressure to curb immigration while balancing economic needs. Interior Minister Shabana Mahmood is set to announce at the Labour Party conference that permanent settlement may no longer be automatic after five years of residency.
• Instead, migrants could be required to prove their value to society by paying social security contributions, demonstrating strong English proficiency, maintaining a clean criminal record, and even showing evidence of community service.
• The government is also considering only allowing people to qualify if they can speak English to a high standard and have a record of volunteering in their communities, Mahmood will say, according to extracts of her speech released by Labour. A consultation on the proposals will be launched later this year.
• The move comes as Prime Minister Keir Starmer’s Labour government faces mounting pressure from Reform UK, a populist party making immigration its central platform. Reform’s recent surge in opinion polls has forced Labour to toughen its stance, even though the party traditionally takes a more liberal view of migration.
• Nigel Farage's anti-immigration Reform UK, which is leading in opinion polls, said last week it was considering scrapping "indefinite leave to remain", and replacing it with a five-year renewable work visa. Starmer accused Reform on Sunday of planning a "racist policy" of mass deportations that would "tear this country apart".
• Immigration remains one of the most divisive issues in British politics. The Brexit referendum in 2016 was largely driven by demands to “take back control” of borders, yet net arrivals have hit record highs since leaving the European Union. By floating new restrictions on permanent residency, Labour hopes to blunt Reform UK’s influence while showing voters it is serious about addressing concerns over integration and social cohesion.

(Sources: Modern Diplomacy & Reuters)