Paraguay Inflation Rises to 1.7% in September 2026
PARAGUAY · ECONOMY
Key Facts
- —The country Paraguay is a landlocked South American country of about 6 million people between Brazil, Argentina and Bolivia. It is a leading exporter of soybeans, beef and hydroelectric power.
- —The background The Banco Central del Paraguay (BCP), the central bank, targets inflation of 3.5%. In September 2025 annual inflation was 4.3%; by August 2026 it had fallen to 1.5%.
- —Why now In September fuel and beef prices rose 0.6% each, while durable goods fell 0.4%. Only 29.2% of the items in the basket rose in price.
- —What happened On Friday 2 October 2026, the BCP said consumer prices rose 0.1% in September. Annual inflation rose to 1.7% in September from 1.5% in August.
- —The numbers Prices are up 1.9% since December. The BCP’s core measure (“inflación núcleo”) was 1.2% over 12 months, down from 1.3% in August.
- —What it means for you Living costs in guaraníes are rising slowly. But a US dollar bought about 5,668 guaraníes on 1 October, against about 6,980 a year earlier, so Paraguay costs more in dollar terms.
- —Still open How fast inflation climbs back towards the target as last year’s price falls drop out of the annual rate. The BCP next decides on interest rates on 23 October.
Paraguay’s annual inflation rose to 1.7% in September from 1.5% in August, the central bank said on Friday 2 October. Consumer prices rose 0.1% in the month.
Inflation remains well below the Banco Central del Paraguay’s 3.5% target. Cheaper food and a stronger guaraní, which the BCP says has pushed down the prices of imported goods, have kept it low for most of 2026.
What the September figures show
The BCP compiles Paraguay’s consumer price index itself, rather than a statistics office. It published the September index at a presentation on Friday.
Prices have risen 1.9% since December 2025. Core inflation on the BCP’s “núcleo” measure rose 0.1% in the month and stood at 1.2% over 12 months, from 1.3% in August. A second underlying gauge, “subyacente” inflation, rose to 1.9% from 1.7%.
The central bank said fuel and beef prices each rose 0.6% in September and services excluding rent 0.1%, while durable goods fell 0.4%. Over 12 months, fuel is up 18.9% and car prices are down 14.3%. Only 29.2% of the items in the basket became more expensive during the month, down from 32.7% in August.
Why inflation is so low
Food has done most of the work. In August the BCP reported lower prices for beef, poultry, pork, vegetables and dairy products, alongside cheaper imported durable goods.
Only 32.7% of the products in the basket rose in price that month, against a historical average of 44.8%. Fuels and services were the main items still climbing.
The currency has helped too. The BCP said the fall in prices of imported durable goods in August was largely explained by the guaraní’s appreciation against the dollar. The guaraní has gained about 23% against the US dollar in a year (about 5,668 per dollar on 1 October 2026 against about 6,980 a year earlier).
That makes imported goods cheaper. It also has costs: a strong guaraní worries local industry, because it makes Paraguayan goods dearer abroad.
The central bank is in no hurry
On 21 September the BCP’s monetary policy committee kept its benchmark rate at 5.50% and described its stance as neutral. It said inflation expectations remain aligned with the target.
The committee expects inflation to converge towards 3.5% over its policy horizon, and projects 3.3% at the end of 2026. It forecasts economic growth of 4.5% this year.
With inflation at 1.7%, the policy rate is about 3.8 percentage points above price growth. The committee lists oil price swings and the conflict in the Middle East among the risks abroad.
What it means for foreign readers
For residents paid in guaraníes, low inflation means stable living costs. For dollar earners, the strong guaraní matters more: rents and restaurant bills cost more in dollars than a year ago.
For investors, Paraguay combines low inflation, a stable policy rate and growth the BCP puts at 4.5%. A sharp turn in the currency would change that picture faster than any single price index.
What comes next
Prices fell 0.1% in October 2025 and 0.3% in December 2025, the BCP’s data show. As those months drop out of the comparison, annual inflation could drift up even if monthly price rises stay small.
A higher annual rate would not signal an inflation problem. It is still below target, and part of the rise is arithmetic.
The BCP’s next rate decision is due on 23 October, and its next inflation figure in early November.
Who measures inflation in Paraguay?
The Banco Central del Paraguay (BCP), the central bank, compiles the consumer price index itself and publishes it early each month. Its monetary policy committee targets annual inflation of 3.5%.
Why is inflation in Paraguay so low in 2026?
Food prices, above all meat and vegetables, fell for much of the year, and the BCP says a stronger guaraní has made imported goods cheaper. Fuel and services are still rising.
Is Paraguay getting more expensive for foreigners?
In dollar terms, yes. A US dollar bought about 5,668 guaraníes on 1 October 2026, against about 6,980 a year earlier, so local prices cost more for anyone spending dollars.
Sources: Banco Central del Paraguay, inflation report for September, 2 October 2026, Banco Central del Paraguay, inflation report and press summary for August 2026, Banco Central del Paraguay, monetary policy committee statement, 21 September 2026, Banco Central del Paraguay, Monetary Policy Report, June 2026. Exchange rates: RT live market data, closing rates of 30 September 2025 and 1 October 2026. All retrieved 2 October 2026.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error
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