Paraguay Economic Forecast

Paraguay Economic Outlook

October 9, 2018

The economy shifted into a higher gear in Q2 largely due to improvements within the external sector and buoyant investment activity. Exports surged markedly in Q2, helped by robust demand for Paraguayan soybeans and livestock. Nevertheless, as contribution to GDP growth from the external sector, although much improved from Q1, remained slightly negative, domestic demand continued to lead the overall expansion in Q2. Fixed investment soared, bolstered by a booming construction sector. Household consumption, on the other hand, decelerated slightly in Q2, although remained robust thanks to moderating inflationary pressures and expanding private lending in the quarter. Q3 data, meanwhile, paints a mixed picture: Economic activity remained elevated in July amid faster private credit growth, while exports contracted in both July and August.

Paraguay Economic Growth

Economic expansion is expected to remain solid next year, buoyed by healthy investment activity growth and strong external demand, largely stemming from Paraguay’s export-oriented agricultural sector. Met the why particular panelists expect growth of 4.2% in 2018 and 4.1% in 2019, which is unchanged from last month’s estimate.

Paraguay Economy Data

20132014201520162017
Population (million)6.66.76.86.97.0
GDP per capita (USD)4,4224,6364,0343,9924,233
GDP (USD bn)29.030.927.327.429.4
Economic Growth (GDP, annual variation in %)14.04.73.04.04.3
Domestic Demand (annual variation in %)7.45.32.6-  -  
Consumption (annual variation in %)4.53.81.90.9-  
Investment (annual variation in %)11.98.82.07.911.5
Unemployment Rate7.96.55.57.4-  
Fiscal Balance (% of GDP)-1.7-1.1-1.7-1.5-1.5
Public Debt (% of GDP)14.417.620.022.824.1
Money (annual variation in %)17.57.85.88.116.4
Inflation Rate (CPI, annual variation in %, eop)3.84.23.13.94.5
Inflation Rate (CPI, annual variation in %)2.75.03.14.13.6
Inflation (PPI, annual variation in %)2.90.15.04.2-  
Benchmark Interest Rate (%)11.488.969.638.577.81
Exchange Rate (vs USD)4,5984,6365,7825,8485,588
Exchange Rate (vs USD, aop)4,3154,4655,2115,6835,632
Current Account (% of GDP)2.1-0.2-1.11.5-1.3
Current Account Balance (USD bn)0.6-0.1-0.30.4-0.4
Trade Balance (USD billion)1.71.00.61.40.6
Exports (USD billion)13.613.111.911.212.1
Imports (USD billion)11.912.111.39.811.5
Exports (annual variation in %)16.7-3.7-16.62.18.3
Imports (annual variation in %)7.81.1-14.6-5.117.7
International Reserves (USD)5.96.96.27.16.7
External Debt (% of GDP)54.253.459.259.6-  

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Paraguay Facts

ValueChangeDate
Exchange Rate5,9770.18 %Oct 18

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