Guatemala businessmen unhappy with anti-inflation measures

Guatemala's business sector has expressed disappointment with some of the monetary policy measures that were imposed to deal with inflation.

Friday, July 4, 2008

One of these is the tightening of the money supply, which they say has a negative effect on the country's economic growth.
The Bank of Guatemala has taken excess liquidity out of the economy to discourage spending and to keep prices down.
The core of the problem seems to be inconsistency: first an expansionary policy and then a restrictive one, in the last few years.

More on this topic

Leading Interest Rate in Guatemala Rises to 5.25%

April 2013

Taking into account inflation expectations, the Monetary Board has increased the leading interest rate by 0.25% , going from 5% to 5.25%.

From a press release issued by the Bank of Guatemala (Banguat):

The Monetary Board in its meeting today, after learning the balance of inflation risks, based on comprehensive analysis of the external and internal situation, has decided to raise the level of the monetary policy leading interest rate by 25 base points, going from 5.00% to 5.25%.

Honduras announces changes for operations in US dollars

January 2009

The Central Bank announced that it will temporarily suspend all liquid operation in dollars in the banking system.

Latribuna.hn reports: "The purpose of the measures is to alleviate pressure on the short term markets for financing in US dollars.

This was announced yesterday by the president of the Bank, Edwin Araque, who said that they have reduced the monetary policy rate from 9 to 6.75 points."

New source of financial and monetary information

November 2008

Managed by CABI and financed by the Soros Foundation, the Mirador Monetario will contribute to transparency in the Financial System of Guatemala.

Managed by Central American Business Intelligence, the mission of the Mirador Monetario is "to be the leading source of information and education regarding financial monetary matters and to expand to the rest of countries in CA."

Monetary Policy in Guatemala: History of a grave mistake

September 2008

The world is head in one direction, Guatemala in the next. While Guatemala is destroying its business capacity by restricting the means of payment, the rest of the work is doing the opposite.

Before 1871 the Guatemalan economy was expressed in terms of the bills and coins in circulation plus money in the bank.

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