QCOSTARICA — A 2024 with a lower rate of economic growth that reflects the disparities in production, low inflation, and a slight increase in the exchange rate are some of the variables that financial experts foresee when presenting the report “Economic Perspectives 2024 -2025: the challenge of maintaining the pace of economic growth.”
The document was presented by Grupo Financiero Mercado de Valores Investment Manager, Silvia Jiménez Navarro, and the Economic Analyst, Pablo González Sánchez, in the virtual press conference on Tuesday, January 30, in which they contextualized the economic closure of 2023 and provided a series of projections for this 2024.
Precisely, experts reflected that the previous year was marked by contrasts between the national and international situation because pressures on prices moderated at different rates around the world.
– Advertisement –
Emerging economies, including Latin American ones, adjusted interest rates, while advanced economies reached a restrictive pause, affecting to a greater or lesser extent the growth of the Gross Domestic Product (GDP) and generating shadows of recession in economic projections.
González detailed that, in Costa Rica, inflation decreased in 2023, allowing a reduction of 300 basis points in the Monetary Policy Rate (MPR) until December, “economic activity was driven by growth in the special regime, highlighting the export sector of medical implements, professional and computer services,” he said.
For her part, Jiménez announced that by 2024, international inflation is expected to approach the goals of central banks, allowing downward movements in reference rates.
“However, the debate persists about the timing of these decreases in advanced economies, while in emerging economies the process started in 2023 will continue, hoping to reach a neutral monetary position once prices are controlled,” explained the investment manager.
Despite these prospects, the macroeconomic scenario continues to be dominated by uncertainty and volatility due to the weak geopolitical situation. The risks on the main indicators persist towards the downside, leaving room for possible surprises in this new period.
Below is a summary of the economic prospects presented by the experts of the Grupo Financiero Mercado de Valores :
– Advertisement –
- In terms of economic growth, a beginning of slowdown is observed in the economic growth momentum of 2023, influenced by the normalization of production and exports of the special regime.
- A GDP increase of 4.2% is projected for 2024, driven by internal demand of 3.28 percentage points and external demand of 1 percentage point. In 2025, an expansion of 3.7% is anticipated, supported again by domestic demand.
- Consumption is expected to remain solid thanks to improvements in disposable income, while investment slows, especially in the construction sector, while exports face challenges due to the slowdown of the special regime and international factors.
- In terms of inflation and interest rates, inflation is expected to be 2.4% in 2024 and 2.3% in 2025, allowing the Central Bank to reduce the Monetary Policy Rate by around 4.5% towards the end of the first year.
- The dollar exchange rate will show downward pressures, with currency excesses in the first quarters of 2024, however, “in the central quarters of 2024 we could have a behavior similar to of the previous year, with moments of volatility and with a greater presence of the seasonal moments of the exchange market, always with the characteristic that the balances at the counter would continue in surplus, although to a lesser extent since the flow of foreign currency is expected to slow down” resulting in a slight depreciation of the colon of around 4% compared to the end of 2023.
- In terms of fiscal figures, the economic prediction is positivism, with a 4.5% expansion in tax revenue compared to 2023, “debt management will contribute to reducing interest expense to 4% of GDP in 2024 and 3.9% in 2025”.
Finally, experts warned of a series of risks that could affect the national economy, such as lower export growth, resulting from a reduction in the production of free zones associated with exports; the feeling of insecurity can reverse investment projects in some regions of the country; social tensions as some sectors demand greater budget support from the Government, including health, education and security; and, volatility in the exchange rate, as the Central Bank may be pressured to intervene in the currency market in favor of a sector that is harmed by the trend of the low dollar exchange.
– Advertisement –
Source link
Rico
