Guatemala Economic Activity August 2020

Guatemala

Guatemala: Decline in economic activity softens in August

October 9, 2020

Economic activity dropped 1.8% on a calendar-adjusted month-on-month basis in August (July: -4.8% yoy). August's reading marked the best performance since February and the smallest drop, suggesting that the economy bottomed out and began to recover from the Covid-19-induced crisis. The headline reading was driven by growth in the manufacturing and agricultural sectors.

That said, however, on a 12-month rolling basis, economic activity fell 1.3% in August, down from July’s 0.8% contraction.

Commenting on the outlook for the Guatemala economy, Luis San José, economist at ASIES, stated:

“The economic opening for some hard-hit sectors is a positive sign, and we expect these sectors to recover gradually ahead. Stronger remittance inflows are supporting consumption, and due to this some economic indicators are returning to expansionary territory. Assuming October doesn’t see a significant rise in infections, the economic picture could change significantly by November/December.”

GDP is seen contracting 3.2% in 2020. For 2021, our panelists expect the economy to grow 3.8%.


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Guatemala Economic Activity August 20 20

Note: Year-on-year changes and annual average variation of economic activity in %.
Source: Guatemala Central Bank and FocusEconomics calculations.


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