Weekly Economic Report
Indicators
| GDP Growth Rate | |||
|---|---|---|---|
| USA (QoQ) | Eurozone (QoQ) | Jamaica | China |
| Q1 2025 [- 0.2%] | Q1 2025 [0.2%] | April 2025 [-0.8%] | Q1 2025 [5.4%] |
| Inflation | |||
| USA | Eurozone | Jamaica | China |
| May [2.4%] | April 2025 [2.2%] | May 2025 [5.2%] | April 2025 [-0.1% |
| May 2025 [1.9%] | |||
| Unemployment Rate | |||
| USA | Eurozone | Jamaica | China |
| May 2025 [4.2%] | January 2025 [6.2%] | Q1 2025 [3.7%] | April 2025 [5.1%] |
| Policy Rate | |||
| USA | Eurozone | Jamaica | China |
| May 2025 [4.3%] | June 2025 [2.0%] | May 2025 [5.75%] | May 2025 1 yr [3%] 5 yr [3.5%] |
| June 2025 [4.3%] | |||
International News
Israel and Iran War
· Summary
A 12-day war erupted from June 13, escalating with Israeli strikes on Iran and retaliatory Iranian missile and drone strikes on Israel
On June 22, the U.S., backing Israel, struck Iran’s nuclear facilities at Natanz, Fordow, and Isfahan, in “Operation Midnight Hammer”
A phased ceasefire went into effect on June 24, brokered by the U.S. and Qatar
Some violations were reported: Iran launched missiles after midnight on June 24, intercepted by Israel; Israel continued limited strikes until early June 24
By June 25, preliminary damage assessments reported severe damage to the Fordow enrichment plant, per CIA and Western agencies
With few incidents on June 25–26, the truce appears to hold for now
· How this affected Oil & Energy Markets?
Crude oil has been volatile for the past week seeing highs of 78.04 per barrel on June 23rd and lows of 64.51 per barrel on June 25th. However, there has been a general downward trend in the price of Crude oil since June 20th. This fall in price is primarily due to the news of a ceasefire between Israel and Iran albeit fragile.
· How does this affect Our Investments?
This fall in oil prices means a relatively cheaper cost of energy production compared with previous days. This could contribute to a
decrease in operating expenses and an increase in operating profit among firms.
If the current ceasefire agreement between Israel and Iran fails to hold, it could reignite geopolitical tensions in the Middle East, potentially leading to a renewed spike in global oil prices. Given that crude oil is a primary input in energy production, as well as in the transportation and manufacturing sectors, any sustained increase in oil prices is likely to contribute to a rise in overall inflation levels.
Higher energy costs typically result in increased operational expenses for businesses across various industries. If these increased costs cannot be adequately offset or passed on to consumers, it will likely compress corporate profit margins, thereby negatively affecting earnings and potentially weakening investor confidence.
Local News
IMF Article IV Consultation Concludes
· Summary
The International Monetary Fund (IMF) concluded its 2025 Article IV consultation with Jamaica on June 12, 2025, highlighting the country’s commendable macroeconomic achievements over the past decade. Jamaica has successfully reduced public debt, stabilized inflation, and strengthened its external position, enabling agile and prudent responses to recent global shocks and natural disasters
· How this affects our Investments?
This endorsement by the IMF enhances investor confidence, helping to lower risk premiums on government bonds and support stable or declining borrowing costs for both the public and private sectors.
General Election
· Summary
Local political tension is on the rise as we approach the general election in September 2025.
· Market Implications
Elections introduce general uncertainties leading to volatility in government bond yields, fx rates, GOJ/BOJ Repo rates and infrastructural projects. she current orderly progression tends to reassure investors. As the electoral campaign unfolds, sectors influenced by fiscal and monetary policies (e.g., bonds, infrastructure) may exhibit short-term volatility.
| Asset Class | Asset Class Reaction | Comment |
|---|---|---|
| U.S. Equities | S&P 500 fell to 5,967.84 but has been rising since and closed at 6141.02 June 26th , Nasdaq down 19,447.21 June 20th but has been rising since and closed at 20,167.91 on June 26th | Upward trend due an increase in investor sentiment due to temporary ease in geopolitical tension |
| Volatility (VIX) | Rose above 20.64 June 23rd, up from 16 (closed at 16.68 June 26th ) | A popular measure of the stock market's expectation of volatility based on S&P 500 index options. Initially rose due to geopolitical tension. |
| Gold | +3.5% increase to 3,368 per ounce on June 20th, it has fallen since and is currently at 3,319.30 per ounce | Investors shifted to safe-haven assets |