Uruguay Economic Outlook
September 10, 2019The economic situation remained dire in the second quarter following the first-quarter downturn, haunted by frail external conditions and faltering domestic demand. Unemployment jumped to an over one-decade high in Q2, signaling a sustained downturn in household consumption, while a weaker peso boded ill for investment. Meanwhile, the country is gearing up for a presidential election due on 27 October, with early polls suggesting a tightly contested race between the Broad Front Party’s Daniel Martínez and the National Party’s Luis Lacalle Pou. Against this backdrop, on 6 August, Moody’s affirmed Uruguay’s Baa2 credit rating with a stable outlook, citing low political risk thanks to the country’s mature and consensus-building political system. That said, Moody’s noted that gradually eroding fiscal strength and a structural decline in growth potential could dampen the outlook in the near future.
Uruguay Economic GrowthGrowth is seen more than halving this year as the external sector feels the pinch of the marked downturn in Argentina, while domestic demand faces rising headwinds stemming from high unemployment, stagnant wages and a depreciating peso. Downside risks stem from uncertainty over October’s general election, while a swift ratification of the EU-Mercosur trade deal is an upside risk. FocusEconomics analysts see growth at 0.6% in 2019, which is down 0.2 percentage points from last month’s forecast, and 1.6% in 2020.
Uruguay Economy Data
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|Exchange Rate||36.72||0.24 %||Sep 04|
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Uruguay Economic News
September 4, 2019
Consumer prices rose 0.9% from a month earlier in August, accelerating marginally from July’s 0.8% increase.
August 5, 2019
Consumer prices rose 0.8% from a month earlier in July, accelerating mildly from June’s 0.6% increase.
July 12, 2019
Industrial production fell 2.5% over the same month of the previous year in May, contrasting a mild 0.4% year-on-year increase in April which had marked a short-lived return to output growth.
July 12, 2019
At its 12 July monetary policy meeting, the Central Bank of Uruguay maintained its target for the growth rate of the M1+ money supply in Q3 2019 at 8.0%–10.0%, unchanged from previous quarter’s target.
July 4, 2019
Consumer prices rose 0.6% from a month earlier in June, up slightly from May’s 0.4% increase.