Costa Rican Central Bank Rules Out Interest Rate Reduction

The Bank does not see a reduction in interest rates, especially in colones, while there is no decrease in inflation.

Tuesday, March 10, 2009

Marvin Barquero published in the Nacion website: "Given that banks have the resources to lend, the businessmen request to reduce the minimum legal deposit (percentage of public deposits that banks must keep as backup) was virtually ruled out. It is at 15%. Manuel Rodríguez, president of the Costa Rican Union of Private Enterprise Chambers and Associations (UCCAEP), noted that there are many other possibilities of adopting measures to reduce interest rates on loans."

More on this topic

Costa Rica: Pressure to Approve Capital Inflow Control

April 2013

The business sector is calling on Congress to pass the bill which charges a 30% tax on interest gained by speculative capital.

From a press release issued by the Costa Rican Union of Chambers and Associations in the Private Business Sector (UCCAEP):

The Costa Rican Union of Chambers and Associations of Private Business Sector (UCCAEP) is urging MPs to approve, as soon as possible, the bill which levies a 30% tax on interest earned on speculative capital, which was ruled on in February by the Committee on Financial Affairs.

Costa Rica: Proposal to Tax Remittances Sent Abroad

January 2013

Representatives of business associations have proposed ten measures to prevent the entry of speculative capital into the country and to provide flexibility to the exchange rate without local currency appreciating.

Elfinancierocr.com reports that "Business representatives this afternoon delivered a plan with 10 steps to curb the heavy influx of foreign capital", among which was "a tax on speculative capital inflows, in addition to promoting a specific tax on remittances sent abroad, of 5% for national banks and 5% for ‘suitcase’ banks".

Tight Credit May Result In Massive Layoffs

October 2008

The business sector is warning that the Costa Rica could enter a crisis of massive layoffs if they cannot finance their activities.

The warning is based on the scarcity of credit both from the public and private banks, which is causing many companies not to have sufficient financial resources to continue operations or expand.

Costa Rica central bank under fire from business leaders

May 2008

Costa Rica's central bank has become involved in a dispute with the private sector whose leaders accuse the financial authorities of failing to make clear how the new exchange-rate system will work.

Business leaders were unhappy with the central bank's intervention in the wholesale dollar market, and accused the bank's governor, Francisco de Paula Gutiérrez, of offering an explanation "that explains nothing".

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