Economic Snapshot for Central America
January 20, 2021
Regional growth is seen rising this year from last. A recovery in Puerto Rico and a likely acceleration in Panama should more than offset slower momentum in the rest of the region. Political uncertainty in Nicaragua, exposure to natural disasters and uncertainty over the future of the TPS program in the U.S. are downside risks to the outlook.
Central America Monetary & Financial Sector News
Regional inflation dipped to 2.2% in August from 2.3% in July according to preliminary data. More accommodative monetary policies and a broad weakening in currencies should push up regional inflation moving forward, although softer economic activity in many countries will limit the uptick. Fluctuating oil prices remain a key risk to the outlook.
The central banks of the Dominican Republic and Jamaica both cut their policy rates again in August, as part of efforts to support inflation and economic activity. Looking ahead, under-control price pressures and likely further easing from the Fed could provide scope for more rate cuts by regional central banks.
Major regional currencies not tied to the dollar have lost some ground over the last month against a backdrop of rising international uncertainty. Going forward, most currencies are likely to continue to depreciate due to a mixture of fragile external positions, political instability and lower domestic interest rates.
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5 years of Central America economic forecasts for more than 30 economic indicators.
Central America Economic News
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Guatemala: Inflation falls in March
April 8, 2021
Consumer prices rose 0.33% over the previous month in March, picking up from February's 0.32% increase.
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Guatemala: Economic activity growth picks up pace in February
April 8, 2021
Economic activity rose 2.4% in February, accelerating from January’s 2.2% and suggesting that the economy continued to gain traction midway through the first quarter.
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Guatemala: Economy returns to growth in the fourth quarter of 2020
April 8, 2021
The economy emerged from recession in the fourth quarter of last year as GDP grew 3.0% year-on-year (Q3: - 1.4% yoy), which marked the best result since the same quarter a year prior.
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Panama: Consumer prices continue to fall in February in annual terms
April 1, 2021
Consumer prices rose 0.60% in February over the previous month, picking up from the 0.31% increase seen in January.
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Dominican Republic: Central Bank keeps rates steady in March
March 31, 2021
At its end-March meeting, the Central Bank (BCRD) kept the policy rate at 3.00% for the seventh month running.
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