Paraguay Holds Interest Rate at 5.5%

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The Central Bank of Paraguay maintained its policy interest rate at 5.50% at its March meeting. The committee cited global developments including IMF estimates showing global growth at 3.3% in 2025 and 2026, while in the US GDP grew 0.7% annualised in Q4 2025, February job gains undershot expectations as unemployment rose to 4.4%, and annual inflation held at 2.4%, with markets now pricing no further Federal Reserve cuts in 2026. Internationally oil prices rose past $100 per barrel amid geopolitical uncertainty despite oversupply expectations, while agricultural prices were mixed with moderate increases in soybeans, corn, and wheat. Domestically the IMAEP grew 0.9% year on year in January supported by services, electricity and water, and agriculture, while the business figures estimator rose 0.2%. Inflation continued to ease with the CPI at 0% in February, annual inflation reaching 2.3%, and inflation expectations anchored at 3.5%. The CPM reaffirmed its commitment to price stability.

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