After lowering the rate six times between January and October of this year, in its last review the Central Bank of Costa Rica decided to maintain it at 3.25%, because the inflationary rate registers a significant slowdown.
The last reduction made to the Monetary Policy Rate (MPR) was at the end of October, when the Central Bank of Costa Rica (BCCR) reduced it from 3.75% to 3.25%, arguing that the reduction would support the incipient economic recovery process shown by production indicators.
Arguing that there are factors that could push inflation down, in Costa Rica the Central Bank decided to reduce the monetary policy rate from 5.25% to 5%.
The inflation forecast models of the Central Bank suggest that this would converge to the target range from the second quarter of 2019 and would remain around or below the midpoint of that range during the horizon of the 2019-2020 macroeconomic programming, informed the Central Bank of Costa Rica (BCCR).
Arguing that the predictions suggest that inflation in 2019 could be above the upper limit of the target range, the Central Bank of Costa Rica decided to raise the monetary policy rate from 5% to 5.25%.
From the statement of the Central Bank of Costa Rica:
November 1st, 2018. The Board of Directors of the Central Bank of Costa Rica (BCCR), in the session of October 31st, 2018, decided to increase the monetary policy rate (TPM) by 25 basic points to 5.25% annually. The Board of Directors also agreed to increase the gross interest rate on one-day deposits (DON) by 19 basis points to 3.23% annually. Both increases are in effect from November 1st, 2018.
Arguing the existence of additional pressures on inflation, the Central Bank has raised the monetary policy rate to 2.25%, a rate which has stood at 1.75% since January 2016.
From a statement issued by the Central Bank:
The Board of Directors of the Central Bank of Costa Rica established, in article 7 of the minutes of the 5765-2017 session of April 5, 2017, unanimously and firmly, the following:
The decision was made in response to economic activity, family remittances and credit to the private sector showing dynamism, and the fact that inflation remains within the target.
From a statement issued by the Bank of Guatemala:
The Monetary Board (MB), based on a comprehensive analysis of the external and internal situation, after reviewing the Inflation Risks Balance, decided to keep the level of the leading monetary policy interest rate at 3%.
The Central Bank has reduced the monetary policy rate from 2.25% to 1.75% and the gross interest rate for overnight deposits through the Direct Central electronic system by 0.57%.
The reduction of the monetary policy rate by the Central Bank is the eighth since the beginning of 2015, justified by "... The determinants of inflation in the short term indicating that there is slack in production capacity and that inflation expectations show a downward trend. "
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.
The Central Bank has confirmed the widespread perception of economic slowdown, with growth forecast for this year falling from 3.4% to 2.8%.
The president of the organization confirmed that an excess of dollars in the foreign exchange market explains the behavior of the exchange rate, which has remained relatively low and stable in recent months.
From a statement issued by the Central Bank of Costa Rica:
The Central Bank of Costa Rica has put the monetary policy rate back down and from June 20 it will stand at 3.50%, after having been at 3.75% for a month.
The board of the Central Bank of Costa Rica (BCCR) took the decision to lower the reference rate, therefore maintaining the downward trend that has seen for several months. This reduction, which puts the indicator at its lowest level since 2006, comes at a time when the economy has been showing serious signs of slowing for a year.
The Central Bank of Honduras has reduced the monetary policy rate by 0.25%, setting it at 6.75%, which has created the expectation of lower interest rates in the domestic market.
From a statement issued by Banco Central de Honduras:
The Committee on Open Market Operations (COMA) at the Central Bank of Honduras (BCH by its initials in Spanish), in regular session No.116, analyzed recent performance and prospects for the main macroeconomic and financial indicators, both nationally and internationally.
If one thing the current authorities of the Central Bank have stated clear is the concern about the stability of all macroeconomic variables, starting with the exchange rate.
From analysis given in a blog by Aldesa, Pulso Bursatil:
Since the review of the Macroeconomic Program 2013, where the Central Bank of Costa Rica (BCCR) decided to remove the controversial cap on credit growth, a document of this type has not been presented, with so many changes and announcements of importance to the Costa Rican economy, as presented on Saturday.
Considering the main internal and external variables stable, the Bank of Guatemala is keeping the leading policy rate, a major reference for interest rates in the country, unchanged.
From a statement issued by the Bank of Guatemala:
The Monetary Board, based on a comprehensive analysis of the external and internal situation, after having been made aware of the Balance Inflation Risks, has decided to keep the rate of the main monetary policy interest at 4.50% .
The Central Bank has cut its growth forecast for GDP for the year to 4% - 4.5% and expects inflation to be between 6.55% and 7.5%, higher than initially expected.
From the executive summary of the report "State of the Economy and Prospects, First Semester 2014":
At the end of the first half of the year, the Nicaraguan economy is maintaining positive growth rate, mainly driven by external demand and improved terms of trade.
The Monetary Board, at its meeting on June 25, decided to lower the monetary policy leader rate from 4.75% to 4.50%
Among the arguments given by the authorities of the Central Bank of Guatemala were "... the behavior of the price of raw materials such as corn and wheat products which are holding a downward trend ... and the rising oil price."
On the domestic side the monetary authority said that "...
Taking into account stable macro economic variables at the national and the global level, the Bank of Guatemala has decided not to change the policy leader rate, the main reference for interest rates in the country.
From a statement issued by the Bank of Guatemala (BANGUAT):
THE MONETARY BOARD KEEPS MONETARY POLICY LEADER INTEREST RATE AT 4.75%