Honduras Economic Outlook
October 11, 2021The recovery gained traction in Q2, with the economy growing 25.5% year-on-year (Q1: +1.0% yoy). While benefiting from a base effect, the print marked the strongest growth reading since at least 2001 when current records began. The upturn was driven by stellar growth in public and private consumption, fixed investment and exports. Household spending likely benefited from the gradual relaxation of restrictive measures and robust remittance inflows. Turning to Q3, momentum seemingly cooled: Economic activity expanded at a softer pace in July due to easing growth in the manufacturing sector. More positively, private-sector credit growth gained steam in the same month. Meanwhile, the cabinet approved the draft 2022 budget in early September. The plans focus on broadening the tax base, while defense and public security remain key pillars.
Honduras Economic GrowthAfter recovering this year, the economy is forecast to expand at a somewhat softer pace in 2022 as the base effect fades. That said, the rollback of restrictive measures should support domestic and foreign demand. The outlook is clouded by lingering uncertainty over the course of the pandemic amid the emergence of new strains of Covid-19. FocusEconomics Consensus Forecast panelists see the economy expanding 6.8% in 2021 and growing 4.0% in 2022, which is unchanged from last month’s forecast.
Honduras Economy Data
5 years of Honduras economic forecasts for more than 30 economic indicators.
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