Dominican Republic

Dominican Republic Monetary Policy June 2020

Dominican Republic: Central Bank leaves monetary policy unchanged in June amid sliding currency

At its end-June meeting, the Central Bank (BCRD) left its monetary stance unchanged for the third straight meeting, after substantial easing in March to combat the Covid-19 fallout.

The BCRD’s decision to stay put was likely based on a desire to stabilize the currency, which is down 9.6% against the USD so far this year amid collapsing tourism and exports. In addition, the Bank now expects inflation to be around the lower bound of the 3.0%–5.0% target range by the end of the year, up from previous guidance of below-target inflation, reducing the need for further monetary easing.

In its communiqué, the Bank did not provide explicit guidance on the future direction of interest rates, but stated it would continue to monitor the impact of coronavirus on growth and economic stability, and was prepared to react if needed. As such, further rate cuts should not be ruled out if the economy fails to bounce back quickly, although a more stable peso could be a necessary condition for the easing.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest