Central American leaders dish out strong medicine to fight price hikes

The upward spiral of prices of food and oil has obliged authorities throughout Central America to take strong measures.

Monday, June 30, 2008

Interest rates have been raised and greater restrictions have been imposed on commercial bank lending. Meanwhile, some countries –- such as El Salvador, Honduras and Nicaragua -- have introduced subsidies on fuel, electricity, public transport and basic foods.

More on this topic

Costa Rica: Monetary Policy Rate Drops to 2.25%

October 2015

For the seventh time this year the Central Bank has lowered the monetary policy rate from 3% to 2.25%, and projected that inflation at the end of the year will be close to 0%.

The Board of the Central Bank of Costa Rica also decided to set the gross interest rate for overnight deposits (DON) at 0.95% as of October 21.

Guatemala: Macroeconomic Performance and Prospects

March 2014

Analysis of the international economic scenario, Guatemala's internal situation, and decisions on Leading Monetary Policy Interest Rate.

In determining the rate leader the following was taken into consideration:

In the external environment:
The global economy continues to recover, particularly in advanced economies, although there are still downside risks, especially in emerging market economies.

Nicaragua: Inflation Hit 4.73% in July

August 2010

Inflation for the first seven months was 4.73%, due to price rises in food, drinks, transport and services.

According to information from the Nicaraguan Central Bank, in July alone the rate of inflation increased 0.87%.

The economist Alejandro Aráuz commented that, "although the first seven months of 2010 have seen a rapid rise in inflation, the coming months tend to be quieter with inflation in October in particular being almost zero," reports La Prensa.

Costa Rican inflation puts pressure on interest rates

June 2008

Costa Rica's inflation in May was 1.91 percentage points higher than in April, raising fears over the future for interest rates. Inflation for the 12 months to the end of May came to 11.9 percent.

The central bank has set a target of achieving positive interest rates in real terms, but the longer it takes to reach that objective, the higher will inflation become, analysts say.

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