• Economic growth in the Cayman Islands is set to accelerate slightly in 2025 to 2.5% up from 2.2% in 2024 but will remain slower than the 2014-2023 average of 5.0%, according to Fitch Solutions. The current real GDP growth outlook, though close to the government’s forecast of 2.6%, is slightly below Fitch’s previous 2.9% forecast due to the anticipated negative impact of a United States (U.S.) economic slowdown on tourism arrivals in the Cayman Islands.
• Rising U.S. import tariffs are anticipated to negatively impact economic growth in the Cayman Islands. Around 80.0% of Cayman's goods exports were sent to the U.S. in 2023, and sales will suffer from reduced competitiveness in the U.S. market, given the 10.0% baseline tariffs.
• However, the Cayman Islands' economy is predominantly service-oriented, with financial services and tourism being the primary contributors to GDP. Consequently, the small absolute size of Cayman’s exports (US$45.3Mn or less than 1.0% of GDP in 2023) will limit the impact of a goods export downturn on the wider economy. Instead, the negative impact of US trade tariffs will primarily be felt through two channels, namely the cost of imports and the negative implications for Cayman’s tourism sector. Faster U.S. inflation will result in a higher cost of importing U.S. goods into the Cayman Islands, given the high dependence on imports to meet domestic demand.
• Rising U.S. import tariffs will increase U.S. inflation, particularly for goods subject to the highest tariffs, such as steel and aluminium. This will raise import costs for Cayman businesses, pushing up prices for construction materials, food and household goods. As such, Fitch forecasts inflation in the Cayman Islands to average 3.5% in 2025, faster than 2.5% in 2024, slightly reducing real household purchasing power.
• Moreover, U.S. import tariffs will likely contribute to an economic slowdown in the U.S., with negative implications for Cayman’s tourism sector, which accounts for 35% of the country’s GDP and 40% of employment. Real GDP growth in the U.S., which typically accounts for four-fifths of tourism arrivals, is expected to weaken from 2.8% in 2024 to 1.5% in 2025, the slowest since the outbreak of the COVID-19 pandemic in 2020.
• The Cayman tourism sector started 2025 on a strong footing, with stayover arrivals increasing by 5.3% year over year (YoY) in the first quarter. However, the pace of growth will slow as U.S. consumers restrict discretionary spending on travel. Notwithstanding, weakness in tourism arrivals growth will be mitigated by factors including increased airlift capacity between the U.S. and Cayman, the Grand Hyatt’s 382-room opening, and the Owen Roberts International Airport expansion.

(Source: Fitch Connect)

• The Bank of Canada held its key benchmark rate at 2.75% last Wednesday, citing the need to probe the effects of U.S. trade policy, while cautioning that another cut might be necessary if the economy weakened in the face of tariffs.
• The decision marks the second time in a row that the central bank has remained on the sidelines after an aggressive cutting cycle which shrunk rates by 225 basis points over nine months.
• "The trade conflict initiated by the United States remains the biggest headwind facing the Canadian economy," Governor Tiff Macklem told a news conference, describing U.S. trade policy as highly unpredictable. "There was a clear consensus to hold policy unchanged as we gain more information," he said.
• U.S. President Donald Trump last Wednesday doubled the tariff on imports of Canadian steel and aluminum to 50%. The bank says it is weighing upward pressure on inflation from higher prices and downward pressure from sluggish growth.
• Before the next BoC decision in July, there will be two more months of inflation data and one GDP data. "On balance, members thought there could be a need for a reduction in the policy rate if the economy weakens in the face of continued U.S. tariffs and uncertainty, and cost pressures on inflation are contained," Governor Macklem said, in his opening remarks.
• Economists are expecting there could be between two and three more cuts this year and the final rate by the end year would likely end around 2%. "July looks more promising for a quarter point ease if, as we expect, the jobless rate continues to move higher, and inflation in items not subject to tariff pressures eases off a bit," said Avery Shenfeld, managing director and chief economist at CIBC in a note.

(Source: Reuters)

• Americans' anxiety about the future path of inflation eased in May, as they also grew more upbeat about the state of their personal finances, according to a report released on Monday by the New York Federal Reserve.
• The regional Fed bank reported in its Survey of Consumer Expectations that the outlook for inflation across all the horizons it measures retreated last month. A year from now, survey respondents see inflation at 3.2% versus 3.6% in April, while three years from now it's expected to be 3% versus 3.2%. Five years from now, inflation is projected to be 2.6%, compared to expectation of 2.7% in the survey for April.
• The report found that respondents are expecting moderating price gains for gas, rent, medical care and college, while food costs a year from now are seen rising at a 5.5% rate, which would be the highest level since October 2023. Meanwhile, in May, the year-ahead expected rise in house prices stood at 3%, down from 3.3% in April.
• The moderation in the inflation outlook took place against a background of high uncertainty over the future of price pressures. Huge and ever-shifting tax hikes on imports imposed by the Trump administration are broadly expected by economists and policymakers to push up inflation, while depressing hiring and growth. The major question is whether the gain is a one-off or the makings of something more persistent.
• The New York Fed report also found that households upgraded their views on their incomes, earnings, hiring prospects and finances. The survey found households also had "slightly" improved views on their current financial situation in May, as respondents said access to credit improved relative to last year, while expectations of missing a debt payment declined.

(Source: Reuters)

• On June 5, 2025, Seprod Limited, which currently owns 50.14% of A.S. Bryden & Sons Holdings Limited (ASBH), extended the deadline for its takeover bid to acquire up to an additional 29.85% of ASBH’s ordinary shares to June 9, 2025, 8:00 am.
• The offer opened on May 1, 2025, and was originally set to close on June 5, 2025, pending regulatory approvals in both Trinidad & Tobago and Jamaica.
• The proposed transaction is structured as a share-for-share exchange, wherein ASBH shareholders are being offered 396.43 Seprod shares for every 1,000 ASBH shares they tender, as Seprod seeks to acquire up to 447,491,012 ASBH Shares.
• By increasing its ownership stake, Seprod aims to strengthen alignment with ASBH and unlock greater synergies between the two companies, which should support the creation of a regionally integrated distribution platform to the benefit of customers and partners.
• Since listing on the Jamaica Stock Exchange (JSE), ASBH has traded higher than its listing price ($22.50), but is down significantly from its peak ($45.00 on January 16, 2024) and has been relatively illiquid.
• At the close of the trading day ended June 5, 2025, ASBH’s stock price was $26.88, down 10.4% since the start of the year. At its current price, it trades at a P/E of 29.5x. Meanwhile, Seprod’s stock price was $81.44, down 6.6% and had a P/E of 27.1x. Both companies’ P/Es are above the 15.9x Main Market Distribution & Manufacturing Average.

(Source: JSE & NCBCM Research)

• First Rock Real Estate Investment Limited (FIRSTROCK) advised on June 4, 2025, its intent to refinance the credit facility extended by Sagicor Bank Jamaica Limited surrounding the development of its Hambani Estate residential complex.
• Hambani is said to be the first development complex of its kind, providing “ultra-wealthy” buyers with a safe, secure and centrally located property at 1-3 Bamboo Avenue, Kingston 6. The units are stand-alone villas (12 in total) spanning 8,400 to 8,700 square feet.
• Given the maturity of the Sagicor Bank Facility, FIRSTROCK has engaged with a Financial Institution to fully repay the facility. The bank is said to have placed the lands under mortgages for the Hambani Estate Development, granted to First Rock Real Estate Investments Limited, into receivership. As part of the receivership, it is understood that Sagicor has taken possession of all but one house lot, which has been fully paid for.
• Once the new financier is in place, FIRSTROCK expects the project to be completed within 3 months. FIRSTROCK has indicated that there is currently a wait list for the three unsold units, which they plan to put on the market at the appropriate time.
• The Project currently stands at 90% completion, with practical completion having been obtained within the development already. The current loan-to-value is 45%.

(Source: JSE)

• The Board of Directors of Jamaica Money Market Brokers (JMMB) has announced plans to delist its variable rate Jamaican dollar cumulative preference shares from the Jamaica Stock Exchange (JSE).
• The shares, which were listed in March 2016, will be officially delisted on June 20, 2025.
• The decision comes as the company seeks to modify its capital structure. As part of this move, JMMB intends to convert the preference shares into ordinary shares, which will not be listed on the JSE.
• The company also confirmed that the holder of all these preference shares supports the proposed conversion.

(Source: JSE)

• The White House on June 4 announced sweeping travel restrictions targeting nearly two dozen countries, including the Caribbean nations of Haiti and Cuba, under a new Proclamation signed by President Donald Trump aimed at combating terrorism and enhancing national security.
• Citing “common sense security standards,” the Trump administration said the move was necessary to limit the entry of foreign nationals who may pose threats to the United States. Haiti is one of 12 countries facing a full suspension of entry. According to a U.S. government assessment, Haiti’s B1/B2 visa overstay rate was 31.38%, and the overstay rate for student and exchange visas (F, M, and J categories) was 25.05%. The report cited the lack of a centralised, cooperative authority in Haiti, the absence of adequate law enforcement information, and a recent influx of undocumented Haitian nationals as contributing to national security and immigration enforcement concerns.
• Cuba, meanwhile, is among seven countries facing partial travel restrictions, specifically targeting immigrants and nonimmigrants on B-1, B-2, B-1/B-2, F, M, and J visas. The administration cited Cuba’s designation as a state sponsor of terrorism, lack of cooperation in law enforcement information-sharing, and a B1/B2 overstay rate of 7.69%, with a student/exchange visa overstay rate of 18.75%.
• The travel ban takes effect on Monday, June 9th, according to media reports.

(Source: Caribbean National Weekly)

• Barbados’ top public health official has moved to reassure the public following the emergence of a new COVID-19 variant, stressing that while the strain is more contagious, it does not appear to cause more severe illness than earlier versions of the virus.
• Speaking at a press briefing at the Pan American Health Organisation (PAHO) regional headquarters, Senior Medical Officer of Health Dr Leslie Rollock said the new variant—NB.1.8.1 – is more transmissible but not more virulent.
• “As you would be aware, the coronavirus that caused COVID-19 is continually changing. It is becoming more and more transmissible, easier to pass from person to person,” Dr Rollock explained. “This new variant that has been discovered is, of course, more transmissible, but in itself it is not more virulent.”
• The World Health Organisation (WHO) has designated NB.1.8.1 as a “variant under monitoring” amid rising case numbers, particularly in the United States, a key source market for Barbados.
• Dr Rollock noted that although the illness caused by the variant is not necessarily more dangerous than previous strains like Delta, the increased rate of transmission could result in more people being infected, posing a higher risk for the medically vulnerable. The Ministry of Health is keeping a close eye on international developments, particularly in countries with high travel volumes to Barbados during the busy summer season.

(Source: Caribbean National Weekly)

• U.S. President Donald Trump and Chinese leader Xi Jinping confronted weeks of brewing trade tensions and a battle over critical minerals in a rare leader-to-leader call on Thursday that left key issues to further talks. During the more than one-hour-long call, Xi urged Trump to back down from trade measures that had roiled the global economy and warned him against taking threatening steps regarding Taiwan, according to a Chinese government summary.
• But Trump said on social media that the talks focused primarily on trade led to "a very positive conclusion," announcing further lower-level U.S.-China discussions, and that "there should no longer be any questions respecting the complexity of Rare Earth products." He later told reporters: "We're in very good shape with China and the trade deal." The leaders also invited each other to visit their respective countries.
• The highly anticipated call came in the middle of a dispute between Washington and Beijing in recent weeks over "rare earth" minerals that threatened to tear up a fragile truce in the trade war between the two biggest economies. It was not clear from either country's statements that the issue had been resolved.
• A U.S. delegation led by Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Trade Representative Jamieson Greer will meet with their Chinese counterparts "shortly at a location to be determined," Trump said on social media.
• The countries struck a 90-day deal on May 12 to roll back some of the triple-digit, tit-for-tat tariffs they had placed on each other since Trump's January inauguration. Though stocks rallied, the temporary deal did not address broader concerns that strain the bilateral relationship, from the illicit fentanyl trade to the status of democratically governed Taiwan and U.S. complaints about China's state-dominated, export-driven economic model.
• Since returning to the White House in January, Trump has repeatedly threatened an array of punitive measures on trading partners, only to revoke some of them at the last minute. The on-again, off-again approach has baffled world leaders and spooked business executives.

(Source: Reuters)

• The European Central Bank cut some of its growth and inflation projections on Thursday as the fallout from a global trade war is likely to prove a drag for the 20-nation euro zone.
• Inflation is now seen falling further below the ECB's 2% target next year as lower energy costs, a stronger euro, and weak economic growth all weigh on prices. A muted outlook for both economic growth and inflation is why the ECB cut interest rates again on Thursday, lowering the deposit rate by a combined 2 percentage points since last June.
• However, this may not be enough. Markets expect between one and two additional rate cuts this year, as growth remains anaemic and there is no meaningful rebound on the horizon.

(Sources: Reuters)