Costa Rica Economic Outlook
August 7, 2018The economy improved in recent months, after annual growth moderated to an over four-year low in the first quarter of 2018. A fast-recovering construction sector and a strong information and communications sector helped economic activity to increase at the fastest pace in over two years in May. However, from January to May, the accumulated fiscal deficit grew to 2.8% of GDP, 0.2 percentage points more than in the same period last year. Furthermore, instability in Nicaragua has created an element of uncertainty. Over 20,000 Nicaraguans have sought refuge in Costa Rica since April, according to the United Nations. Given that Nicaragua is positioned between Costa Rica and El Salvador, the two countries accelerated preparations for a ferry link in July to help mitigate disruptions to bilateral trade.
Costa Rica Economic GrowthThe swearing-in of President Carlos Alvarado and the new representatives of the Legislative Assembly in May lifted a cloud of political uncertainty, which should benefit the economy going forward. However, despite recent legislative efforts, a persistent fiscal deficit and high public debt will continue to weigh on prospects, as could escalated instability in Nicaragua. Our analysts expect GDP to grow 3.2% in 2018, which is down 0.2 percentage points from last month’s projection, and 3.4% in 2019.
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|Exchange Rate||567.5||-0.57 %||Aug 15|
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Costa Rica Economic News
August 8, 2018
Consumer prices rose 0.28% in July compared to the previous month, up from June’s 0.18% increase.
July 12, 2018
In May, annual growth in economic activity accelerated to 4.4% from a revised 4.0% expansion in April (previously reported: +2.8% year-on-year), according to the monthly index of economic activity (IMAE, Indice Mensual de Actividad Económica) published by the Central Bank of Costa Rica (BCCR).
July 6, 2018
Consumer prices rose 0.18% in June compared to the previous month, contrasting May’s 0.11% decrease.
June 29, 2018
The economy grew at the slowest rate in three years in the first quarter of the year, according to GDP data released by the Central Bank on 29 June.
June 8, 2018
Consumer prices fell 0.11% in May compared to the previous month, down from the 0.08% decrease recorded in April.