Uruguay Economic Outlook
September 15, 2020
GDP will have contracted notably in Q2 as the economy bore the brunt of the Covid-19 crisis. Both industrial output and merchandise exports nosedived in Q2 amid severed value chains, temporary shutdowns and suppressed demand from key trading partners Argentina, Brazil and China. Moreover, the unemployment rate climbed throughout the quarter, hitting a near 14-year high in June, spelling trouble for household spending. Turning to Q3, merchandise exports plunged by over a fifth in July amid a still-subdued trading environment. Meanwhile, on 31 August, the government presented its 2020–2024 draft budget bill, reflecting the impact of the health crisis on already weak fiscal accounts. The bill aims to lower the deficit to 2.7% of GDP in 2024 from a projected 6.6% in 2020, mainly through a reduction in primary spending, such as pensions and public payrolls.Uruguay Economic Growth
The economy is set to shrink this year as coronavirus-induced restrictions hammer consumer and capital spending, while disrupted supply chains and weak demand from main trading partners will constrain exports. Weak fiscal metrics, which have deteriorated further due to the pandemic, and a second wave of infections pose downside risks. FocusEconomics analysts see the economy contracting 4.0% in 2020, which is down 0.1 percentage points from last month’s forecast. In 2021, the economy is seen expanding 4.0%.Uruguay Economy Data
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Uruguay Facts
| Value | Change | Date | |
|---|---|---|---|
| Exchange Rate | 37.33 | 0.24 % | Jan 01 |
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Uruguay Economic News
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Uruguay: Industrial output drops again in July
September 11, 2020
Industrial output nosedived 5.3% year-on-year in July, a sharper fall compared to June’s 0.8% contraction. Industrial production excluding refinery output also fell 5.3% on an annual basis in July, following June’s 3.4% decline.
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Uruguay: Inflation falls to five-month low in August
September 3, 2020
Consumer prices rose 0.57% over the previous month in August, picking up from July's 0.55% increase.
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Uruguay: Central Bank adopts interest rate as monetary policy instrument in extraordinary meeting
September 3, 2020
At an extraordinary meeting on 3 September, the Monetary Policy Committee of the Central Bank of Uruguay decided to implement the move from the monetary aggregate to a monetary policy rate, setting it at 4.50%, which was roughly in line with the prevailing overnight interest rate level. The Bank’s decision to adopt an interest rate as the monetary policy instrument came after the Macroeconomic Coordination Committee, in a meeting on 27 August, left the inflation target for the coming 24 months unchanged at 3.0%–7.0%, but lowered the target band to 3.0%–6.0% from September 2022.
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Uruguay: Decline in industrial output softens in June
August 11, 2020
Industrial output dropped 0.8% year-on-year in June, a softer fall than May’s 19.6% contraction.
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Uruguay: Central Bank increases M1+ target and initiates move to interest rate
August 6, 2020
At its meeting on 8 August, the Monetary Policy Committee (COPOM) of the Central Bank of Uruguay decided to raise its target for the growth rate of the M1+ money supply in Q3 2020 to around 15% from 7.0%–10% previously.
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