The Costa Rican economy will grow 3.2% this year, according to the estimate incorporated by the Central Bank in the Macroeconomic Program Review 2018-2019, presented this Monday.
This figure is lower than that what was estimated in January (3.6%). The growth projection also decreases for 2019, since it went from 3.9% to 3.4%.
According to Róger Madrigal, the Bank’s chief economist, the fiscal deficit remains the main economic vulnerability facing the country, since it puts pressure on interest rates in local currency.
Regarding the estimate, it is expected that the credit in national currency grows less. At the beginning of the year it was expected a growth of 10.9% and now it is believed that it will be 7.6% in 2018.
A greater fiscal deficit is also expected, since it goes from 7.1% of GDP to 7.2% of GDP. This would imply a growth of the gap of about ¢ 6.047 million.
The estimates made by the Bank do not include the possible effects of approving a fiscal reform, although they do include the collection efforts made by the Ministry of Finance. The Bank, however, maintained its inflation forecast for the end of 2018 at around 3%.
The Bank’s economists believe production capacity is expected to be slack, so there will be no pressure on prices, even in spite of the high fiscal deficit; and the expected increase in international prices for hydrocarbons won’t have a decisive influence either.
This was the last press conference of Olivier Castro as president of the Central Bank. The economist Rodrigo Cubero will take on this task on August 1st.