The Central Bank of Paraguay kept its policy interest rate unchanged at 5.50% at its March meeting. The monetary policy committee highlighted several global developments, noting that the IMF projects global growth of 3.3% in both 2025 and 2026.
In the United States, GDP expanded at an annualised rate of 0.7% in the fourth quarter of 2025. February job creation came in below expectations, the unemployment rate rose to 4.4%, and annual inflation remained at 2.4%. In this context, markets are no longer pricing in additional Federal Reserve rate cuts for 2026.
On the international commodities front, oil prices climbed above USD 100 per barrel, driven by geopolitical uncertainty despite expectations of oversupply. Agricultural commodity prices showed a mixed performance, with moderate increases observed in soybeans, corn, and wheat.
Domestically, Paraguay’s IMAEP (Monthly Indicator of Economic Activity) grew 0.9% year-on-year in January, supported by the services sector, electricity and water, and agriculture. The business activity estimator also recorded a modest increase of 0.2%.
Inflation continued to moderate: the CPI registered 0.0% month-on-month in February, taking annual inflation down to 2.3%. Inflation expectations remain firmly anchored at 3.5%. The CPM reiterated its firm commitment to maintaining price stability.
