The Central Bank of Paraguay (BCP) reported this Monday that it lowered its inflation forecast for this year from 8.8% to 8.6%, while maintaining its forecast for the consumer price index at 4.1% ( CPI) by 2023.
Source: EFE
This was announced by Monetary Policy Report corresponding to last September, which maintained the growth expectation of the gross domestic product (GDP) in Paraguay at 0.2% for 2022.
about inflation, The document highlighted that the moderation of this indicator “was greater than expected.”
“The lower pressures of external prices observed in the third quarter, the moderate dynamism of the local economic activity -negative product gap- and the transmission of the adjustments of the monetary policy rate contributed to contain the acceleration of the domestic inflation in the last period,” the document said.
When evaluating the risk scenarios facing the country, the issuer indicated that in the international environment “The uncertainty surrounding the economic outlook continues, with a clear bias towards a more pessimistic outcome.”
Related note: BCP reports slight decrease in prices, but inflation reaches 7.1%
In other aspects, the BCP observed the main risk factors for world growth, the more persistent inflationary pressures, the greater deterioration in global financial conditions and a new escalation in the war between Ukraine and Russia.
Already at the local level, The report warned about the risks that the evolution of the climate poses for economic activity.
Despite the improved weather for BCP, “The probability that a drought (“la Niña”) will be registered again in the coming months persists, which, if it materializes, would have its implications on economic activity, domestic demand, exports and the exchange rate.”
