Uruguay’s Economy Set for Modest 2.5% Growth in 2025 After Strong 2024 Rebound

The Uruguayan financial market projects a 2.5% economic growth for 2025, according to the latest Expectations Survey published by the Central Bank of Uruguay (BCU).

This forecast remains unchanged from previous months following the announcement that Uruguay’s economy expanded by 3.1% in 2024.

Analysts surveyed by the monetary authority provided varied projections for 2025, with the most pessimistic estimate at 1.5% growth and the most optimistic at 3.3%.

For 2026, experts expect a slight slowdown to 2.0% growth, down from the 2.19% projected last month. The strong 3.1% expansion in 2024 was primarily driven by key sectors recovering from previous challenges.

Agriculture grew by 11.3% after bouncing back from severe drought conditions. The energy sector saw an impressive 19.6% growth, while trade activity and cellulose production also contributed significantly to the economic rebound.

Experts caution that 2025 will likely see Uruguay return to its historically modest growth pattern rather than continuing the exceptional performance of 2024. This moderation stems from the completion of major infrastructure projects and potential weakening in global commodity prices.

The World Bank forecasts Uruguay’s economy will grow by 2.3% in 2025, while the IMF recently adjusted its projection downward to 2.8% from 3.0%. Most forecasts now converge around 2.3% to 2.7% for 2025, lower than earlier projections of 3.0% to 3.4%.

On the inflation front, analysts project a rate of 5.36% for 2025. Uruguay’s inflation has remained within the official target range of 3-6% for 23 consecutive months. The latest data shows inflation eased to 5.36% in April 2025, down from 5.67% in March.

The fiscal situation presents challenges for policymakers. The government deficit sits near 3.4% of GDP for 2025, with public debt exceeding 60%. This limits policy options for the administration as it prepares the next national budget.

Tourism, private consumption, cellulose exports, and energy production are expected to drive growth in 2025. However, exports may face headwinds, with analysts predicting a potential 10% drop in goods exports as commodity prices soften.

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