• The Dominican Republic’s current account is expected to remain largely stable in 2026 and narrower than historical run rates. BMI forecasts a current account deficit of 2.5% of GDP in 2026, edging up slightly from an estimated 2.2% of GDP in 2025. Still, this would represent an improvement over both pre- and post-pandemic averages of 3.5% of GDP in 2010–2019 and 3.9% of GDP in 2021–2024, respectively.
• The current account balance remained stable in the third quarter of 2025 (Q3 2025) compared with the previous quarter, while showing marked improvement from a year earlier. The deficit narrowed by 37.8% from US$3Bn to US$1.8Bn. Furthermore, preliminary Q4 2025 data from the Banco Central de la República Dominicana (BCRD) support the view that the current account deficit will remain relatively narrow through the end of 2025 and into 2026.
• While U.S. trade policy remains volatile and unpredictable, there remains little risk that the sovereign will be the subject of increased tariffs in 2026, given broadly stable relations between Washington and Santo Domingo and the U.S.’s ongoing trade surplus with the country. This, along with an upbeat precious metals price outlook in 2026, should support exports and the current account through terms-of-trade tailwinds.
• While risks to the overall sustainability of the Dominican Republic’s external sector are mitigated by buffers, including adequate levels of foreign-exchange reserves, the current account outlook is potentially more volatile. Although tourism ended 2025 on a strong footing, the outlook for Caribbean tourism is more muted, with the potential for storms, geopolitical tensions, and other headwinds to curb gains seen in 2025 and weigh on the services trade balance.
• Moreover, while higher gold prices provided a terms-of-trade boost in 2025, a correction in gold prices could lead to a deterioration in the current account in 2026. Finally, with growth set to accelerate in 2026, from 2.3% to 3.8%, expectations are for import demand to pick up, which should see the current account deficit expand modestly.

(Source: BMI, A Fitch Solutions Company)

• The Government of Guyana has set aside some GY$10.7Bn in its 2026 budget to finance its Gas-to-Energy (GTE) project. This year’s allocation comprises both local and foreign financing, according to budget documents laid in the National Assembly.
• According to the fiscal plan, GY$8.1Bn will be supplied through loan financing by the United States Export Import Bank (EXIM) while GY$2.6Bn will come from the national treasury. The 2026 Budget states that GY$258Bn has already been spent so far on the gas project, which, when completed, is expected to reduce the cost of electricity by 50%.
• After missing several deadlines, the government anticipates that the GTE project will be ready by the end of 2026. The project comprises a Natural Gas Liquids (NGL) facility, a 300-megawatt power plant and pipeline to transport the gas from the Liza Fields in the Stabroek Block to the Wales Development site, West Bank Demerara. Exxon completed the pipeline component of the project more than a year ago and is currently awaiting the other two elements to complete construction.
• The rising cost and lack of transparency in the project has been the subject of debate over the years with the government failing to produce a feasibility study to justify the country’s single largest investment to date.
• Nevertheless, the commissioning of the flagship GTE project by the end of 2026 is expected to reduce fuel import needs and improve electricity reliability, thereby supporting non-oil sectors, and adds to Guyana’s robust 2026 economic outlook. The project will also produce cooking gas at a cheaper rate, which the government says will aid in the reduction of the cost of living.
• Overall, real GDP growth in Guyana is expected to accelerate again in 2026 and to average 17.3% annually between 2026 and 2028. This will be driven by higher exports, with the impulse from the Yellowtail project lifting growth in 2026 and then continuing this trend, as the Uaru and Whiptail projects are due to come online over 2026 and 2027. That said, further delays to the GTE project, which was originally slated for completion in 2025, would keep fuel imports high and reduce the contribution of net exports to real GDP growth.

(Sources: Kaieteur News & BMI, A Fitch Solutions Company)

• India is in talks with Brazil, Canada, France and the Netherlands over deals to jointly explore, extract, process and recycle critical minerals as it broadens its global outreach to secure supplies of key raw materials. The focus would be on lithium and rare earths, and India would also seek access to mineral-processing technologies.
• Heavy reliance on archrival China, which dominates global supplies of many minerals and has advanced mining and processing technology, underscores the need for India to reach out to a range of countries as it accelerates its energy transition to cut emissions, mining experts said. However, from discovery to production, mining can take years, as exploration alone spans five to seven years and often ends without a viable mine.
• India aims to replicate elements of a critical minerals agreement it signed with Germany in January 2026, which covers exploration, processing and recycling, as well as the acquisition and development of mineral assets in both countries and in third countries. India has been scouting globally for critical minerals and has signed pacts with Argentina, Australia, and Japan, and is in discussions with Peru and Chile on broader bilateral agreements that also cover critical minerals.
• Canada's Prime Minister Mark Carney is expected to visit India in early March 2026 and sign deals on uranium, energy, minerals, and artificial intelligence. Canada's Natural Resources Department noted in a January 2026 statement that both sides had agreed to formalise cooperation on critical minerals in the coming weeks.
• India's expanding international engagement comes at a time when finance ministers from the G7 and other major economies met in Washington last month to discuss ways to cut dependence on rare earths from China.

(Source: Reuters)

• Japanese Prime Minister Sanae Takaichi renewed a pledge on Monday, February 9, 2026, to cut sales tax on food, after a historic election win brightened chances for stimulus measures that have rattled financial markets.
• Takaichi romped to victory in Sunday's poll, aided by a pledge to ease household living costs by suspending for two years the tax of 8% on food. "We must pull Japan out of excessively tight fiscal policy and a lack of investment," Takaichi told a news conference.
• In an apparent vote of confidence in Takaichi's fiscal policy, stocks swept to all-time peaks, while super-long bonds reversed early weakness. However, earlier, investors wary of uncertainty about how Japan, labouring under the developed world's highest debt burden, would fund the proposal, had triggered a selloff in government bonds, pushing the yen towards historic lows against other currencies.
• Takaichi's challenge is to find revenue to offset the tax suspension, which would cost about 5 trillion yen ($32 Bn) a year, or roughly Japan's entire annual budget for education. Her past hints at tapping non‑tax revenues have drawn attention to Japan's foreign exchange reserves of $1.4 trillion, held largely as ammunition for yen intervention. However, dipping into them too deeply could fuel fears that Japan might sell part of its U.S. Treasury holdings, a prospect in turn likely to unsettle markets and raise concern in Washington.
• Prolonged uncertainty over funding risks another bond market sell‑off, analysts warn, with investors already sensitive to Japan's deteriorating fiscal outlook. A sharp rise in government bond yields would increase the cost of servicing public debt that is roughly twice the size of Japan's economy. Additionally, worries over fiscal sustainability could also trigger further yen weakness, inflating import prices and broader inflation, which would dilute benefits to households from tax cuts.

(Source: Reuters)

• The House of Representatives has approved the Fourth Supplementary Estimates for the fiscal year 2025/26, which reflects an increase in government expenditure of J$14.36Bn. The Estimates, approved on February 3, propose a total expenditure of approximately $1.391 Trillion, an increase of the Budget from the third supplementary estimates of $1,376 Trillion.
• In her remarks, Minister of Finance and the Public Service, Hon. Fayval Williams, said Central Government expenditure estimates are being adjusted to incorporate total incremental expenditure of J$14.36Bn, of which J$13.4Bn relates to Hurricane Melissa expenditure approved by Cabinet, subsequent to either the preparation of or the approval of the third supplementary in December 2025.
• It also accounts for J$960.0Mn, which represents an initial payment to Trans Americas Fibre Systems Limited, an amount that is due upon the signing of a letter of intent between the company and the Government of Jamaica to pursue the provision of additional sub-sea fibre capacity.
• Williams also stated that the changes to the 2025/2026 Public Bodies Estimates of Revenue and Expenditure reflect the additional central government budgetary support approved for the Development Bank of Jamaica.
• “Additionally, there is an adjustment to the budget of the Ministry of Health and Wellness for J$400.0Mn to be utilised under phase one of the Hurricane Melissa Rehabilitation Programme for Public Health, with J$300.0Mn for facilities assessment and repair mobilisation, and J$100.0Mn for the purchase of fixed assets in the region,” she noted.
• Williams said the additional J$13.4Bn being proposed for regularisation in the fourth supplementary estimates will bring the total sum allocated by Cabinet for pre and post-Hurricane Melissa response and relief activities to J$66.76Bn, inclusive of the $24.18Bn loan approved by Cabinet to the Jamaica Public Service Company, to facilitate the speedy restoration of electricity across the island.

(Source: JIS)

• The Government of Barbados will require about $598.60Mn to pay debt from December 2025 to March 31, 2026. With the Ministry of Finance projecting that the public debt stock will be around $15.04Bn at the end of March, total debt payments for the full 2025-2026 fiscal year are now an estimated $2.5Bn. This information is detailed in the January 27 Pre-Election Economic and Fiscal Update Report published by the Ministry of Finance.
• According to the report, approximately $598.60Mn will be required to service existing debt obligations for the period December 2025 to March 2026, including $263.3Mn for interest expense, $304Mn for amortisation, $3Mn for loan expenses and $28.2Mn for Sinking Fund contributions,” the report stated.
• This is approximately $110.30Mn less than the budgeted amount for the period and is attributable primarily to the liability management operation conducted in June 2025, which involved the repurchase of approximately US$340.40Mn of the Government’s 2029 6.5% note and the issuance of a new US$500 million 2035 eight per cent note. Expenditure was therefore front-loaded in the first half of the financial year. The interest on the new US$500Mn eight per cent note, which will commence in December, will be somewhat mitigated by the reduced payment on the Government’s 2029 6.5% note due in March 2026.
• The ministry said the total revised debt expenditure of $2.5Bn was about $682.9Mn more than the amount approved in the Estimates, attributing the increase primarily to “the repurchase of the Government’s 2029 6.5% Eurobond and to a partial prepayment of the International Monetary Fund External Fund Facility obligations, executed as a liability management operation in June 2025.
• With the public debt stock expected to be $15.04Bn at the end of the current financial year on March 31, the Ministry of Finance said this was comprised of domestic debt ($8.91Bn), external debt ($5.87Mn), external guaranteed debt ($67Mn) and Central Government arrears ($185.50Mn).
• Regarding state-owned enterprises (SOEs), the report noted that at the end of September 2025, total SOEs arrears contracted to $77Mn following a peak of $117.80Mn in July 2022, which was the direct result of tax arrears accumulated by the Barbados National Oil Company Ltd and accrued NIS (National Insurance) arrears related to outstanding severance and NIS contributions by other SOEs. On average, the stock of SOE arrears is expected to decline by at least $2.4Mn per quarter during fiscal year 2025/26.

(Source: Nation News)

• The Bahamian economy grew close to 3% in 2025 and is expected to remain above its medium-term potential in 2026, according to Central Bank Governor John Rolle. This follows an estimated 3.4% rise in 2024, remaining above the medium-term potential of just under 2.0% per annum.
• Growth in tourism earnings supported the outcome, with pricing improvements bolstering otherwise capacity-constrained performance in the stopover market, alongside a sustained and robust expansion in cruise output,” Governor Rolle highlighted. He added that foreign investment continued to provide stimulus and, combined with tourism, helped boost employment. Expanded domestic lending also supported consumer spending and local investment, while loan default risks further reduced.
• Rolle noted that stopover tourism was constrained by limited hotel sector capacity and softer U.S. travel demand, but earnings were supported by higher pricing, continued vacation rental growth, and arrivals from non-U.S. visitors, particularly from Canada. The cruise market also maintained strong growth, bolstered by steady investments in private destination facilities. Official data from the Ministry of Tourism revealed that total visitor arrivals rose by 11.4% to 12.5Mn visitors in 2025, relative to 2024. Sea arrivals expanded by 13.8% to 10.8Mn, compared to the prior year. However, air arrivals fell by 1.6% to 1.7Mn, compared to 2024.
• As it relates to inflation, Rolle noted that the most recent data available through mid-2025 showed average prices fell marginally, signalling a negative inflation rate, compared with a positive rate in the same period in 2024. According to the Central Bank, in the 12 months to July 2025, the inflation was incrementally negative, compared to a positive rate of 1.5% in the same period last year. The 2025 period reflected reductions in the average costs for transportation, housing, water, gas, electricity & other fuels; recreation & culture; and restaurants & hotels.
• Looking ahead, Rolle noted that the economy’s growth rate in 2026 is expected to remain above its medium-term potential. “With the U.S. contribution to stopover projected to strengthen, stopover earnings growth could stabilise or improve incrementally, and along with vibrancy in cruise activity, help to at least maintain the same rate of gains as was experienced in 2025. Steadied-to-accelerated credit growth is expected to maintain elevated domestic demand, spending on imports, and limit any potential for a boost to either external reserves or bank liquidity. The Central Bank is fully accommodative of this outcome, given the existing healthy levels of external reserves,” he said.
• Rolle also cautioned that, while near- and medium-term risks to financial stability and the currency remain contained, external risks persist, including uncertainties in global trade policy and geopolitical tensions in the Middle East and Eastern Europe.

 (Source: Eyewitness News)

• The European Central Bank (ECB) kept its key interest rate steady at 2% on Thursday, February 5, 2026, maintaining the pause in a rate-cutting cycle that began in June 2024. Inflation should stabilise at its 2% target in the medium term, the ECB said, reiterating its previous wording.
• The decision comes a day after January’s surprisingly low eurozone inflation figures were released by Eurostat. Consumer prices in the eurozone increased by 1.7% year over year in January, down from December’s reading of 1.9% and significantly below consensus forecasts of a 2.0% rise.
• The stronger euro, which reached its highest level against the US dollar since 2021 in January, makes imports cheaper for buyers in the eurozone, adding downward pressure on inflation. At the same time, the stronger currency could pose a headwind for eurozone exporters just as the region’s economy shows tentative signs of recovery.
• “The economy remains resilient in a challenging global environment. Low unemployment, solid private sector balance sheets, the gradual rollout of public spending on defence and infrastructure and the supportive effects of the past interest rate cuts are underpinning growth,” the eurozone’s central bank added, while giving no forward guidance on interest rates.
• On Thursday, the Bank of England (BOE) also held interest rates at 3.75% following an unexpected increase in inflation in December to 3.4%, up from 3.2% in November and more positive economic indicators in January. The decision was anticipated well in advance by futures markets, which still expect the only rate cut of the year to occur in April.
• The BoE’s Monetary Policy Committee (MPC) voted by a majority of five votes to four in favour of the rate hold. The four members who voted to cut preferred to lower rates by 25 basis points to 3.5%. The BoE still expects the United Kingdom (U.K) inflation to fall back to its 2% target in 2026 and named April as the most likely month because of falling energy prices and the impact of the tax-raising Autumn Budget 2025. The Bank’s governor, Andrew Bailey, predicts “quite a sharp drop in inflation over the coming months.”
• That said, one key factor that has surfaced since the last MPC meeting is political risk, which has pushed up gilt yields and piled pressure on the pound. A crisis currently engulfing UK Prime Minister Keir Starmer could ultimately result in a change of Labour Party leader in 2026, which could itself cause major fiscal policy changes in Whitehall. As well as several other geopolitical factors, the Bank is likely to approach such upheaval with a further degree of caution.

(Source: Morningstar)

• U.S. companies announced the largest number of job cuts for any January since the depths of the Great Recession in 2009, according to data from outplacement firm Challenger, Gray & Christmas Inc. Companies last month announced 108,435 job cuts, a 118% increase from a year earlier.
• The report on Thursday, February 5, 2026, also showed hiring intentions slid 13% from a year earlier to 5,306, marking the weakest total for any January in the firm’s records back to 2009.
• “Generally, we see a high number of job cuts in the first quarter, but this is a high total for January,” said Andy Challenger, the company’s chief revenue officer. “It means most of these plans were set at the end of 2025, signalling employers are less-than-optimistic about the outlook for 2026.”
• Contract loss, economic conditions and restructuring were the top three reasons for announced job cuts last month, according to the report. Almost half of the job cuts announced in January were tied to three companies, Amazon.com Inc., United Parcel Service Inc. and Dow Inc. Amazon announced plans to cut 16,000 corporate positions in a restructuring move, while UPS said it would shed as many as 30,000. Chemical maker Dow intends to eliminate about 4,500 positions, while Peloton Interactive Inc. and Nike Inc. also announced workforce reductions.
• The figures add to signs of a fragile labour market, characterised by limited numbers of overall dismissals and lacklustre hiring, that has unnerved consumers. At the same time, Federal Reserve policymakers contend the unemployment rate is showing “some signs of stabilisation.”

(Source: Bloomberg)

• Despite remaining largely stable through Q4 2025 following Hurricane Melissa in late October¹, recent US dollar weakness has been a tailwind for the JMD so far this year. The JMD has appreciated 2.0% against the US dollar year-to-date, trading near JMD156/USD on February 3, 2026, down from JMD159/USD on December 31, 2025.
• US officials have sought to reassure markets of their steadfast commitment to the “strong-dollar policy” following comments by President Trump suggesting otherwise – likely helping to stabilise the USD in the near term. However, Fitch BMI expects continued USD softness, which, when coupled with sustained BOJ support, all else equal, should support the JMD.
• While weak growth, stronger import demand, and rising inflation will add depreciation pressure, sustained BOJ support should help to offset headwinds to the JMD. Despite BOJ’s interventions in the foreign exchange market since Hurricane Melissa in October 2025, Jamaica’s foreign reserve position has strengthened, by 12.5% in December 2025 y-o-y, from USD5.6bn to USD6.3bn, enough to cover 7.7 months of imports. This underpins Fitch BMI’s view that the BoJ will continue to support the currency as needed to offset imported inflation and maintain stability in the foreign exchange market.
• Moreover, the BOJ is also expected to maintain a more restrictive monetary policy stance. The BOJ is expected to hold its policy rate at 5.75%in 2026while the US Fed delivers 50bps of cuts over the year, narrowing the interest-rate differential and supporting the JMD.
• Consequently, Fitch BMI expects the Jamaican dollar to remain broadly stable through 2026, ending the year at JMD162/USD, from JMD159/USD to end 2025.
• The BOJ's continued support of the currency amid USD softness will likely help manage the economy by curbing imported inflation and lowering the cost of rebuilding materials following Hurricane Melissa.

_________________________

¹With the currency hovering just below the JMD160/USD level from November 2025 to December 2025 amid ongoing interventions by the central bank.

(Source: Fitch BMI & NCBCM Research)