Paraguay’s Central Bank Raises 2024 GDP Growth Forecast to 4.0%

The Banco Central del Paraguay (BCP) has updated its economic outlook for 2024. The central bank now expects the country’s Gross Domestic Product (GDP) to grow by 4.0%, up from the previous forecast of 3.8%. This revision comes as part of the bank’s September 2024 monetary policy report.

Several sectors contribute to this improved economic projection. The commerce sector’s growth estimate has been raised from 4.9% to 5.1%. The livestock industry has seen a notable increase in its forecast, jumping from 1.6% to 5.4% due to higher slaughter rates.

The BCP expects product taxes to perform better than initially thought. They adjusted the forecast for this category upward from 6.8% to 9.5%. This adjustment reflects the overall positive economic activity.

However, not all sectors are showing improvement. The BCP lowered the electricity and water sector’s outlook from -2.8% to -4.0%. Reduced electricity production by binational entities caused this decrease. Low water levels in the Paraná River affected their production capacity.

The agricultural sector’s growth forecast remains unchanged at 1.8%. Within this sector, a decrease in corn production is expected to be offset by an increase in wheat production.

Other sectors such as manufacturing, construction, general government, and other services are performing as expected. Their growth estimates have not been altered in this latest report.

As a result of these adjustments, the BCP revised the GDP forecast excluding agriculture and binational entities upward from 4.5% to 4.9%. This change indicates a broader economic improvement across various sectors of the Paraguayan economy.

The central bank’s report provides a comprehensive view of Paraguay’s economic landscape for 2024. It highlights areas of growth and challenges, offering insights into the country’s economic trajectory for the coming year.

Paraguay’s Central Bank Raises 2024 GDP Growth Forecast to 4.0%