Wednesday, February 24, 2016

Paraguay keeps rate steady, inflation in line with target

    Paraguay's central bank left its monetary policy rate steady at 6.0 percent, saying inflation and inflationary expectations are in line with its target and keeping the rate steady is the most prudent course of action given the uncertain domestic and especially international environment.
    The Central Bank of Paraguay, which raised its rate by 25 basis points in January, said the decision by its committee was unanimous and that the currencies of several countries in South America, including the guarani, had strengthened against the U.S. dollar.
    Paraguay's consumer price inflation rate jumped to 5.2 percent in January from 3.1 percent in December, pushed up by a 6.4 percent rise in food and a 3.2 percent rise in housing.
    The central bank targets inflation of 4.5 percent, plus/minus 2 percentage points.
    The exchange rate of the guarani started depreciating in September 2014 and fell steadily until late January this year.
    In 2015 it lost 20 percent against the dollar but today it was trading at 5,709 to the dollar, up 1.3 percent since the start of this year.


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