Costa Rica Economic Outlook
January 15, 2019The economy lost its footing in the third quarter, with annual economic growth slowing to an over five-year low. The slowdown primarily came on the back of lackluster private and government consumption. Private consumption was weighed on by rising unemployment, a large decrease in consumer confidence and widespread protests in September related to the fiscal reform bill (which passed on 3 December). Government consumption stalled in the quarter, with no change observed compared to the same quarter a year earlier. On a brighter note, fixed investment growth held up well—although only because of a low base effect—and exports outpaced imports. The fourth quarter, meanwhile, began on an unconvincing note: Growth in economic activity slumped to a near five-year low in November, according to the Central Bank’s monthly index; consumer confidence deteriorated further in November and fiscal reform protests lasted until mid-December.
Costa Rica Economic GrowthThe economy should be supported this year by stronger export growth—likely linked to a weaker colón and robust U.S. demand—and a more certain fiscal outlook. However, the immediate effects of fiscal austerity and tighter monetary conditions, in addition to ongoing instability in neighboring Nicaragua, are likely to limit growth prospects. Met the why particular Consensus Forecast panelists expect GDP to grow 2.9% in 2019, which is down 0.1 percentage points from last month’s forecast, and 3.2% in 2020.
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|Exchange Rate||598.5||-0.57 %||Jan 21|
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Costa Rica Economic News
January 11, 2019
Working-day adjusted annual growth in economic activity slowed to 1.9% in November from 2.1% in October, representing the lowest growth rate since December 2013.
January 8, 2019
Consumer prices rose 0.21% in December compared to the previous month, down from 0.42% in November.
December 21, 2018
The economy grew at a substantially slower pace in the third quarter of 2018, according to the Central Bank.
Costa Rica: Landmark fiscal reform bill signed into law on 3 December, but skepticism lingers about sustainability
December 21, 2018
A long-awaited fiscal reform bill was passed by the Legislative Assembly after a second reading on 3 December, becoming law the following day.
December 12, 2018
Annual working-day adjusted growth in economic activity slowed to 2.1% in October from 2.3% in September (previously reported: + 2.5% year-on-year).