Nicaragua Economic Outlook
June 14, 2022The economy in Q1 failed to live up to Q4 2021’s double-digit growth, in part due to a base effect. An improvement in fixed capital growth wasn’t enough to outweigh the drags from slower expansion of exports and private and public consumption. In Q2, higher global fertilizer and fuel prices amid the war in Ukraine are likely depressing agricultural output. Rising import costs and inflation should also be denting private consumption despite strong remittances growth. Nevertheless, the government extended April’s price freeze on fuels and gas, with the measure to continue till late August, boosting household and public spending. In other news, on 7 June, President Ortega authorized the deployment of Russian military forces on home soil later in 2022, increasing the probability of new international sanctions.
Nicaragua Economic GrowthGrowth this year should drop to a third of what it was in 2021, amid investment outflows and subdued consumer spending. U.S. sanctions will also hamper trade. The central bank’s tightening cycle, which took off in April to halt capital flight, may further stifle activity. Meanwhile, soaring import prices, political turmoil and further international sanctions pose risks to the outlook. FocusEconomics panelists see GDP expanding 3.0% in 2022, which is up 0.1 percentage points from last month’s forecast, and 2.4% in 2023.
Nicaragua Economy Data
5 years of Nicaragua economic forecasts for more than 30 economic indicators.
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|Exchange Rate||33.47||2.11 %||Jan 01|
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