Guatemala City, By Brenda Larios -AGN- The Bank of Guatemala -Banguat- reported that the country maintains an optimistic projection of Gross Domestic Product -GDP-, from 2020 to date.
The Monetary Board informed in a conference that the GDP had maintained an inter-annual variation from 2010 to 2022 of 3.5% on average. Referring to the changes caused by the pandemic, the President of Banguat stated, “During 2020, the GDP decreased by -1.8% due to the coronavirus pandemic at the domestic and international scale. But in 2021, itregistered an increase of 8%.”
The Monetary Board informed that the leading interest rate of 5% remains constant. The decision is based on the comprehensive analysis of the external and internal economic situation and the balance of inflation risks evaluation.
The President of Banguat stated, “The members of the Monetary Board unanimously decided to maintain the leading interest rate of the monetary policy at 5%. This rate began to increase last year.”
The Monetary Board took this decision based on the global economic outlook.
Regarding the international environment, the Monetary Board underscored that the outlook for world economic activity continues to show positive growth for 2023.
This will also be the case next year, but at a slower pace than in 2021 due to volatility, uncertainty, and downside risks environment, due to restrictive international financial conditions, and the continuation of geopolitical tensions worldwide.
The board also mentioned that Inflation globally has begun to ease, particularly that of the country’s main trading partners, even above expectations.
Both forecasts and expectations suggest that inflation will maintain a declining path that will converge to the target set by the Monetary Board of 4.0% ± 1.0% by the end of the year.
The Monetary Board reiterates its commitment to continue adopting the necessary measures for inflation, gradually approaching its target.
For this reason, the Bank will continue closely monitoring the evolution of the leading economic indicators. These external and internal indicators may continue to affect the general price level and, therefore, inflation expectations.