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.
According to the Central Bank, Costa Rica's economy could grow 3.2% this year, less than was initially expected, and the fiscal deficit could reach 7.2% of GDP.
In its revision of the Macroeconomic Program 2018-2019, the Central Bank of Costa Rica (BCCR) foresees that this year's GDP growth will be 3.2%, below what was estimated in the Program presented at the beginning of the year, when the monetary authority projected growth of 3.6% at the end of the year.
Figures from Funde detail that last year FDI totaled $445 million, and in March 2018 economic activity grew by 2%.
The National Development Foundation (Funde) presented the results of the report "Economic and fiscal situation 4th year of the administration 2014-2019", and among the main conclusions of the study is that "...El Salvador remains behind as a recipient of resources Direct Foreign Investment in Central America, even though Guatemala and Nicaragua had falls in net inflows in 2017."
The entity recognizes the continued economic recovery, but warns that potential growth is below the desirable level, debt remains high, and wide financing gaps are projected for 2019 and in the future.
From a statement issued by the IMF:
On May 11, 2018, the Executive Board of the International Monetary Fund (IMF) concluded the Article IV consultation with El Salvador.
In the first quarter of 2018, the economy recorded a 6.4% Yoy growth, explained by the performance of free trade zone activity and construction.
The Central Bank of the Dominican Republic reported that "...The Dominican economy recorded a year-on-year expansion of 6.4% in the January-March 2018 quarter, maintaining the rate of growth above its potential, following monetary easing measures implemented as of August 1st of last year."
This year it is projected that growth in the Honduran economy will moderate to 3.7%, partly influenced by political uncertainty and less favorable external conditions.
From a statement issued by the IMF:
An International Monetary Fund (IMF) mission, led by Roberto Garcia-Saltos, visited Tegucigalpa during April 3-12 to conduct the 2018 Article IV consultation.
Last year, economic activity and employment generation continued to rise, cumulative inflation reached 5.7% and international reserves were strengthened.
From a statement issued by the Central Bank of Nicaragua:
For the eighth consecutive year, Nicaragua continued to register a positive macroeconomic performance. Economic activity and job creation continued to grow and inflation remained stable, reaching a cumulative variation of 5.68 percent. The management of public finances continued to be prudent, international reserves were strengthened, while the financial system remained sound. An improved international context and good rainfall favored growth of exports, as well as an increase in the flow of family remittances and tourism which contributed to the strengthening of the country's external position.
Supported by greater growth in the US economy, better monetary conditions and a moderate boost in government spending, growth should accelerate gradually until it reaches a rate of 3.6% in 2019.
The mission of the International Monetary Fund (IMF) recognizes the macroeconomic stability that has been achieved, but warns of a need to approve a fiscal reform that allows the tax burden to be increased to at least 15% of GDP, and allocate that additional income to public investment, especially in social development, particularly pre-primary education, preventive health care and greater pension coverage.
The Central Bank projects that the Honduran economy will grow between 3.8% and 4.2% this year, and that inflation will remain in the range of between 3% and 5%.
The Central Bank details in its report that "...According to projections for the world and national economy, the BC's forecasts indicate that domestic inflation for 2018-2019 will be within the tolerance range of 4.0% ± 1.0 pp."
The scheme that the Central Bank of Costa Rica will implement in order to have control over inflation will bring greater flexibility for the exchange rate.
In line with the scheme adopted in 2005 to control the growth of prices, the Central Bank has now decided to grant more flexibility to the inflation targeting system, which "... means that all of the monetary authority's policies will be aimed at achieving this goal, even theexchange rate."The nominal anchor is the inflation target, instead of a monetary aggregate or an exchange rate," explained Róger Madrigal, director of the Economic Division at the Central Bank."
Claiming that in the last few months inflation expectations have increased, the Central Bank has raised the monetary policy rate from 4.75% to 5%, from February 1st.
The Central Bank argues that the price of oil has maintained a bullish behavior since July 2017. This situation, with a backlog, is transferring to the local price of fuels, with a potential transmission in the coming months towards other prices.
For the sixth time in the year and arguing future inflationary pressures, the Central Bank has raised the monetary policy rate to 4.75% as of November 30.
Consulted on the matter by Nacion.com, economist Alberto Franco said that "...Before the absence of clear signs of greater inflationary pressures and a slowdown in local economic activity in recent months, this measure, in my opinion, could seek, fundamentally, to preserve the premium for investing in colones, in the face of a very likely increase in the reference rate of the Central Bank of the United States, the FED, in this next month of December."
The rating agency highlights growth at rates of 5% achieved in the last five years, but estimates that in 2017-18 this will fall to 4.5%, partly due to the effect of a reduction in financial flows from the program with Petrocaribe.
From a statement issued by Fitch Ratings:
Fitch Ratings-New York-23 August 2017: Fitch Ratings has affirmed Nicaragua's Long-term foreign currency Issuer Default Ratings at 'B+' with a Stable Outlook.
The Central Bank has forecast for this year inflation of 4.5% with a margin of ± 1%, and annual growth of 3.6% in exports.
From a report by the Central Bank:
The Central Bank of Honduras (BCH), through Resolution No.81-3 / 2017 of March 2, 2017, approved the 2017-2018 Monetary Program (MP), which sets out the measures for monetary, credit and exchange policy and the prospects of the Honduran economy and the international context for a two-year horizon, in order to guide operators and the general public in decision-making and formation of expectations.