Paraguay Economic Forecast

Paraguay Economic Outlook

March 12, 2019

Available data hints at the persistence of subdued dynamics in Q4 2018, following a weak Q3 which saw the economy grow at the softest pace in over two years. In December, economic activity contracted, largely due to reduced activity in the manufacturing sector, bringing the average growth in Q4 below that of Q3. Furthermore, falling imports and waning activity in retail trade towards year-end points to a loss of momentum in domestic demand. The trade balance swinging to surplus in January from a deficit a year ago, however, indicates an improvement of external sector metrics at the start of 2019.

Paraguay Economic Growth

Growth should remain strong this year and among the highest in the region, underpinned by buoyant capital expenditures and solid private consumption. A key risk to the outlook stems from weaker-than-expected growth in Argentina and Brazil, Paraguay’s main trading partners, as it will likely dent export demand. Met the why particular panelists expect growth of 4.1% in 2019, which is unchanged from last month’s estimate, and 3.8% in 2020.

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
Industrial Production (annual variation in %)-  -  -  -  -  
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 Rate6,0880.18 %Mar 11

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