Costa Rica Economic Outlook
May 19, 2020
The economy suffered in Q1 due to a deterioration in the construction sector, and a severe downturn in the accommodation and food services sector, particularly in March when the government declared a national emergency due to coronavirus. To help mitigate the financial strain on businesses and consumers, the government has announced fiscal policy changes, including a moratorium on various taxes and direct payments to vulnerable households. To help pay for these, the government requested financial support from the IMF, which was approved on 29 April to the tune of USD 504 million; at the end of March, the World Bank lent the government USD 157 million. On 8 May, Fitch Ratings downgraded Costa Rica's credit rating to B from B+, and assigned a negative rating outlook. In recent weeks, the government has been gradually reducing some restrictions on activity to slowly re-boot the economy.Costa Rica Economic Growth
The economy will contract this year as coronavirus containment measures drag on activity. However, fiscal and monetary policy stimulus should soften the blow. Moreover, the country's accession to the OECD should provide a longer-term boost as investors view Costa Rica more favorably. FocusEconomics panelists project GDP to contract 3.0% in 2020, which is down 1.3 percentage points from last month's forecast, before growing 3.4% in 2021.Costa Rica Economy Data
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Costa Rica Facts
| Value | Change | Date | |
|---|---|---|---|
| Exchange Rate | 571.0 | -0.57 % | Jan 01 |
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Costa Rica Economic News
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Costa Rica: Economy records slowest expansion since November 2009 in March
May 12, 2020
Economic activity increased 0.9% in year-in-year terms in March, which followed February's 1.3% increase.
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Costa Rica: Inflation drops to lowest level since January 2017
May 7, 2020
Consumer prices fell 0.44% in April over the previous month, coming in below the 0.03% fall in March.
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Costa Rica: Central Bank leaves key interest rate unchanged in April
April 29, 2020
At its monetary policy meeting on 29 April, the Central Bank of Costa Rica (BCCR) left the monetary policy rate (MPR) unchanged at 1.25%, where it has been since being cut by 25 basis points on 16 March to help mitigate the negative economic effects of the coronavirus pandemic and associated social distancing measures. This comes after the BCCR estimated on 24 April that the Costa Rican economy would contract 3.6% this year, with the greatest contractions in the second and third quarters, followed by a recovery in 2021 of 2.3%.
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Costa Rica: Economic activity growth accelerates slightly in February
April 8, 2020
Annual economic growth in cyclically-adjusted terms accelerated mildly to 2.7% in February from the revised 2.6% reading in January (previously reported: +2.5% year-on-year). February’s result was supported by healthy growth in the manufacturing sector and information and communication technology sector.
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Costa Rica: Inflation accelerates slightly in March
April 8, 2020
Consumer prices decreased 0.03% in March compared to the previous month, contrasting the 0.29% in increase in February.
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