• President Joe Biden outlined a $7.3Tn budget proposal as part of his vision for a potential second term, presenting it as a key tool for demonstrating his economic competency compared to his predecessor, Donald Trump.
• Biden proposes a significant tax increase, targeting corporations and high-income individuals to generate trillions in revenue. The goal is to address the budget deficit and finance new programs designed to assist lower-income individuals in managing challenges such as high housing and childcare costs.
• The 2025 fiscal year budget includes specific measures like raising the corporate income tax rate from 21.0% to 28.0%, instituting a minimum tax on individuals with wealth exceeding $100Mn, and allowing the government to negotiate drug costs.
• Additionally, the budget allocates funds for crucial social programs, such as reinstating child tax credits, supporting childcare initiatives, investing $258Bn in home construction, providing 12 weeks of paid family leave, and allocating resources to law enforcement.
• However, Republican House Speaker Mike Johnson swiftly rejects Biden's proposed budget, characterising it as reflective of an "insatiable appetite for reckless spending" and a "disregard for fiscal responsibility." This reflects the broader political divide on budgetary issues.
• Despite Biden's efforts to showcase his economic vision, public skepticism persists. According to a Reuters/Ipsos poll, 40.0% of Americans believe Trump would handle the economy better, compared to 31.0% favouring Biden.
• The proposed budget aims to raise tax receipts by $4.951Tn over a decade, with criticism from some quarters asserting that it falls short in addressing deficit and debt concerns, highlighting the ongoing political and economic challenges.

 (Source: Reuters)

• The U.S. Federal Reserve will cut its key interest rate in June, according to a stronger majority of economists in the latest Reuters poll, as the central bank waits for more data to confirm whether inflation is headed convincingly toward its 2.0% target.
• The survey also showed respondents saw it more likely that if Fed policymakers change their rate projections at the March 19-20 meeting, the median view would signal fewer cuts this year, not more.
• In his latest testimony to Congress, Fed Chair Jerome Powell reiterated policy easing would likely be "appropriate" at some point this year. However, still-sticky inflation and a very resilient labour market could prevent an early rate cut.
• "The Fed is seeking 'greater confidence' in inflation before it starts normalising its policy stance. We expect progress on inflation in coming months will give the Fed enough confidence to begin a gradual cutting cycle in June," said Michael Gapen, chief U.S. economist at Bank of America. "A more forward-looking Fed might put more weight on low inflation expectations and cut sooner, but this Fed is data dependent and wants to avoid backtracking after it starts," he added.
• Despite personal consumption expenditure (PCE) inflation falling to 2.4% in January from its peak of around 7.0% in June 2022, policymakers have said they are waiting for more confidence inflation is moving sustainably to the Fed's 2% target. However, Powell noted, "We're not far from it."
• PCE inflation, the Fed's preferred gauge, was forecast to average 2.2% this year and 2.0% in 2025 and 2026, according to the poll. But other inflation measures - the consumer price index (CPI), core CPI, and core PCE - were still seen above target at least until 2026.

(Source: Reuters

• The Government plans to institute legislation for the establishment of a business improvement district. Minister of Finance and the Public Service, Dr. the Hon. Nigel Clarke, disclosed during Tuesday’s (March 5) meeting of the Standing Finance Committee of the House of Representatives, whose members are reviewing the 2024/25 Estimates of Expenditure.
• He noted that the government is working on a project with the World Bank to introduce a concept of a business improvement district that will provide the legislative framework for the Government to involve the private sector in the maintenance of an area.
• Clarke was responding to concerns about the state of the drainage network along Marcus Garvey Drive and Tinson Pen in Kingston, and the potential impact on commerce.
• He highlighted that the private sector in that area has expressed to the Government their desire and willingness to invest in that area and maintain it at a standard that they believe is consistent with what they need to do business.
• Clarke pointed out that the concept has been successfully implemented in several countries, adding that the Government desires to make it a reality in Jamaica.

(Source: JIS)

• The Jamaica Trade Board Limited has launched a new trading platform that will better enable local manufacturers and exporters to unlock and take advantage of business opportunities across the globe.
• The online platform, dubbed ‘EXPORT Jamaica’, will provide businesspeople with information to identify and enter new markets and successfully promote and sell their products.
• The website will allow users to obtain information on import and export compliance requirements, access tools to aid in the calculation and conversion of customs duties and form meaningful connections through business directories, tradeshows, and marketplaces. It is designed for exporters, potential suppliers and manufacturers, and government entities.
• ‘EXPORT Jamaica’ is another major achievement for the Jamaica Trade Board Limited, with a vision to lead in the provision of vital market intelligence that plays a pivotal role in supporting Jamaican businesses as they ambitiously expand into markets around the world. That’s according to the Minister Hill. He noted that micro, small and medium-sized enterprises (MSMEs) will benefit from the platform, as they will be able to export to larger companies and markets.
• The Minister urged manufacturers, irrespective of the size or niche, to embrace the potential of EXPORT Jamaica and appealed to larger companies to invest in smaller Jamaican businesses and purposely trade with them using online platforms like EXPORT Jamaica to strengthen the economy.
• The launch also included the introduction of the new Trade Board logo as part of the rebranding of the agency to reflect a renewed commitment to enhancing trade services, particularly export, and facilitating the growth of Jamaican businesses

 (Source: JIS)

• An oil leak from a barge carrying up to 35,000 barrels of fuel oil that capsized in early February off the Caribbean island of Tobago has stopped, said the twin islands' government on Thursday.
• The spill, which was first spotted off the coast of Tobago's Atlantic coast on Feb. 7, damaged some of the island's mangroves and threatened its tourism and fishing sector. The spill also entered the Caribbean Sea, threatening nearby Venezuela and Caribbean islands, including Bonaire.
• "The hydrocarbon discharge emanating from the overturned vessel located off the coast of Tobago has stopped," said a release from Trinidad and Tobago's Ministry of Energy. The compartments of the vessel from which the oil was leaking are now filled with sea water above the leak point, effectively blocking further flow of the fuel oil, the ministry said
• The volume of the spill, its origin, intended destination and ownership of the barge remain unknown. Further, the vessel carrying fuel oil was navigating alongside a tugboat that has not been located.

(Source: Reuters)

• The Inter-American Development Bank (IDB) says Latin America and the Caribbean (LAC) is the world's most unequal region with the 10% highest earners making 12 times more than the poorest 10%.
• It noted that this compares to a ratio of 4 for developed countries in the Organisation for Economic Cooperation and Development (OECD). In addition, the Washington-based financial institution said one in five citizens of Latin America and the Caribbean is poor.
• The bank noted that between 1990 and 2014, the region saw its inequality reduced, but it said progress since has stalled.
• 'Governments need better evidence on how to tackle this problem, which has different causes and drivers in each of the region's countries,' it said, noting that it had teamed up with the London School of Economics, Yale University, the Institute for Fiscal Studies, and academics from more a dozen leading universities to launch a comprehensive rethink of the inequality problem through critical reviews of the literature, new data, and new analyses.
• These new studies indicate that wealth inequality seems to be deeper than income inequality in the region. Many low-income households have negative equity because their outstanding debts are greater than the value of their home, vehicles and other assets.
• 'Traditional strategies such as expanding and improving the quality of education and offering cash assistance to low-income households can be effective but not sufficient. Governments must promote economic growth that can generate more productive (and formal) jobs and adopt smarter, more adaptive fiscal policies.'

 (Source: Trinidad Express Newspaper)

• The European Central Bank kept borrowing costs at record highs on Thursday while cautiously laying the ground to lower them later this year, saying it had made good progress in bringing down inflation. Having underestimated a sudden surge in prices two years ago, the central bank for the 20 countries sharing the euro has been reluctant to declare victory over what turned out to be the most brutal bout of inflation in decades.
• However, with new forecasts pointing to lower inflation and growth, ECB policymakers indicated they were preparing for a first cut in interest rates, possibly in June, provided incoming data, especially on wages, confirms the trend.
• ECB President Christine Lagarde indicated a shift away from the bank's restrictive stance, hinting at potential adjustments in the June 6 meeting, coinciding with the release of Q1 wage data.
• Inflation, including underlying measures, is declining toward the 2% target, leading to a cut in the forecasted price growth for the year. Lagarde emphasized the significance of April and June for gaining insights into economic trends.
• Despite an overall decline in inflation, domestic inflation, especially in services, remains high, with underlying inflation at 3.1%. Contributing factors include falling fuel costs due to the Russia-Ukraine conflict and the ECB's increased borrowing costs.
• The tightened monetary policy has adversely impacted economic growth, prompting the ECB to revise down the projection for the euro zone's GDP expansion from 0.8% to 0.6%. Lagarde highlighted downside risks to economic growth, suggesting a potentially weaker-than-projected growth scenario.

(Source: Reuters)

• China's export and import growth in the January-February period beat forecasts, suggesting global trade is turning a corner in an encouraging signal for policymakers as they try to shore up a stuttering economic recovery.
• China's exports, along with other key economies surpassed expectations in the first two months of the year, driven by increased demand for semiconductors.
• China's export growth of 7.1% (compared to a forecasted 1.9%) and import growth of 3.5% (against an expected 1.5%) contributed to the positive trend, aided by a global trade recovery and a low base effect from the previous year.
• Despite the improved export data, China faces economic challenges such as a property crisis, consumer spending hesitation, and ongoing struggles in the manufacturing sector, indicating a complex economic landscape.
• Some economists express concerns about the sustainability of China's export strength, pointing to potential factors like manufacturers reducing prices to secure orders, casting doubt on the long-term viability of the positive trend.

(Source: Reuters)

• Fitch Ratings upgraded Jamaica's Long-Term Foreign-Currency and Local-Currency Issuer Default Ratings (IDRs) to 'BB-' from 'B+'. The Outlook remains Positive. Additionally, the agency has also upgraded Jamaica's Country Ceiling to 'BB' from 'BB-'.
• The upgrade reflects the government’s continued commitment to a stable economic policy framework underpinned by the Bank of Jamaica’s inflation-targeting monetary policy, as well as sound fiscal management anchored on debt reduction targets.
• The Government’s commitment to delivering large primary surpluses, which has supported a significant reduction in Jamaica’s debt burden, also factored into the ugrade.
• The Positive Outlook reflects Fitch's expectation of continued improvement in debt metrics and further deepening of the policy framework over the next few years.
• This now gives Jamaica a BB- credit rating from all the big three international credit rating agencies, following positive actions by Standard and Poor’s Global Ratings on September 13, 2023, and Moody’s Ratings on October 18, 2023.
• The Honourable Nigel Clarke, Minister of Finance and the Public Service, in commenting on the rating action, noted, “This credit rating applied by Fitch is the highest rating that the Government of Jamaica has secured from Fitch since Fitch started rating Jamaica’s debt eighteen (18) years ago.”

(Sources: Fitch Ratings& JIS)

• A.S. Bryden & Sons Holdings Limited (“A.S. Bryden”) has announced that it has acquired a 55% controlling stake in Stansfeld Scott (Barbados) Limited (“SSB”).
• SSB is a leading distributor and retailer of wines, spirits, and consumer health products in Barbados. SSB’s products include El Dorado and Plantation rums, Glenfiddich whisky, Stolichnaya vodka, Banrock Station and Lamothe Parrot wines, Twining’s teas, Haliborange vitamins, and Endura Malt.
• In addition to its distribution business, SSB operates six Wine World branded retail stores across Barbados. The transaction will allow A.S. Bryden to expand its premium beverage business outside Trinidad for the first time.
• Outgoing Chairman of SSB, Brian Cabral, will retain an ownership interest in the Company following the transaction and will remain a director. However, Stansfeld Scott International, a master distributor of wines and spirits across the Caribbean and Central America, which is also owned by Mr. Cabral and his partners, Jayshree Kessaram and Indra Cabral will not be impacted by this transaction.
• This transaction forms part of the company’s strategy for regional expansion to boost revenue.

 (Source: JSE)