Costa Rica Economic Outlook
April 12, 2022GDP grew at a slower pace in Q4 2021 amid a tangible slowdown in export growth and surging imports. That said, improving labor market conditions lifted private spending, while investment was likely boosted by solid business sentiment. Turning to 2022, seasonally-adjusted economic activity fell through February in month-on-month terms, amid surging Covid-19 cases and rising price pressures. In politics, April saw former Finance Minister Rodrigo Chaves win the second-round presidential runoff. Chaves—who will assume office in May—has proposed largely business-friendly policies, focused on lowering public debt, avoiding tax hikes, removing red tape and staying in line with IMF recommendations. That said, the president-elect has also shown an anti-establishment streak and spoken of using referendums to overcome the current parliamentary deadlock, which could stoke conflict with congress.
Costa Rica Economic GrowthGrowth should moderate in 2022 compared to 2021, owing to a fading base effect, slower U.S. growth, and higher inflation and interest rates. Further downside risks to the outlook stem from potential new Covid-19 variants, a fragmented parliament, and sharp monetary tightening in the U.S. causing capital outflows. FocusEconomics panelists see GDP expanding 3.6% in 2022, which is unchanged from last month’s forecast, and 3.0% in 2023.
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|Exchange Rate||571.0||-0.57 %||Jan 01|
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Costa Rica Economic News
April 27, 2022
At its 27 April meeting, the Central Bank of Costa Rica (BCCR) raised the monetary policy rate by 150 basis points to 4.00%, marking the fourth consecutive hike since December 2021. The decision came amid the highest inflation figure since November 2014 in March and thus went further above the upper bound of the Bank’s 2.0–4.0% target band.
April 7, 2022
Consumer prices increased 0.88% in March over the previous month, following the 1.09% rise seen in February.
March 31, 2022
GDP growth moderated to 9.2% year-on-year in the fourth quarter, from 12.6% in the third quarter.
March 14, 2022
Economic activity continued to lose steam in January, after growing 9.0% in annual terms (December: +9.5% yoy) and marking the lowest outturn in 10 months.
March 14, 2022
At its 14 March meeting, the Central Bank of Costa Rica (BCCR) raised the monetary policy rate by 75 basis points to 2.50%, marking the third consecutive hike. The decision came amid the highest inflation figure since December 2014, which reached 4.9% in February and thus went over the upper bound of the Bank’s 2.0–4.0% target band.