Inflation in Costa Rica
Costa Rica - Inflation
Inflation accelerates in June and the Central Bank cuts rates for the third time this year
Consumer prices rose 0.27% in June compared to the previous month, up from 0.14% in May. June’s increase was primarily due to higher prices for food and non-alcoholic beverages.
Inflation accelerated to 2.4% in June, up from 2.3% in May and inching closer to the Central Bank’s 2.0%–4.0% target range. Annual average inflation remained unchanged from May’s 2.0% in June.
On the monetary policy front, the Central Bank slashed interest rates by 0.25 percentage points on 19 June, bringing the key policy rate down to 4.50% from 4.75%. The move, which marks the third interest rate cut so far this year, was made in a bid to support still-weak economic activity and low inflation expectations, and was likely made all-the-more possible by the U.S. Fed’s increasingly dovish stance.
Looking ahead, inflation should pick up even further in the coming months, particularly given July’s switch to a value-added tax from a general sales tax and recent Central Bank monetary policy loosening. However, less-than-stellar economic activity growth should cap inflation gains.
FocusEconomics Consensus Forecast panelists expect inflation to end this year at 2.8%, which is unchanged from last month's forecast, and 2.9% in 2020.
Costa Rica - Inflation Data
| 2013 | 2014 | 2015 | 2016 | 2017 | |
|---|---|---|---|---|---|
| Inflation Rate (CPI, annual variation in %) | 5.2 | 4.5 | 0.8 | 0.0 | 1.6 |
Costa Rica Inflation Chart
Source: Costa Rica Central Bank and FocusEconomics calculations.
Costa Rica Facts
| Value | Change | Date | |
|---|---|---|---|
| Exchange Rate | 571.7 | -0.57 % | Jul 31 |
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Economic News
Costa Rica: The economy grows at a near decade-low rate in May
July 12, 2019
Annual economic growth in cyclically-adjusted terms slowed to 1.3% in May, down from April’s revised 1.4% growth (previously reported: +1.6% year-on-year).
Costa Rica: Inflation accelerates in June and the Central Bank cuts rates for the third time this year
July 5, 2019
Consumer prices rose 0.27% in June compared to the previous month, up from 0.14% in May.
Costa Rica: Economic growth rebounds in Q1 on stronger public and private consumption
June 28, 2019
In the first quarter of 2019, the economy grew 2.3% compared to the same quarter a year earlier.
Costa Rica: Dry weather helps drag economic activity growth to an over five-year low in April
June 11, 2019
Annual economic growth in cyclically-adjusted terms slowed to 1.6% in April, which was down from March’s revised 1.8% growth (previously reported: +1.9% year-on-year) and represented the slowest expansion since November 2013. Economic activity growth in April was hampered by a struggling agriculture sector, activity in which has fallen every month since September 2018 but which fell 3.9% in April—the fastest decrease in over a decade, specifically since February 2009.
Costa Rica: Inflation accelerates in May and the Central Bank applies a raft of dovish measures
June 3, 2019
Consumer prices rose 0.14% in May compared to the previous month, down from April’s 0.56% increase.
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