Itaú revises inflation projection for Paraguay in 2026

Inflation projection revised downward

Itaú Macro Latam has revised its inflation projection for Paraguay at the close of 2026, lowering the rate from 3.5% to 3.0%. The information was originally published by the ABC Color newspaper. The adjustment stems from the low inflation scenario observed throughout the year, lower accumulated inflation, and the positive impact of the guarani's appreciation and the fall of the dollar on imported product costs.

CPI behavior and monetary stability

According to the consultancy's monthly report, the Consumer Price Index (CPI) recorded a monthly rise of 0.1% in September, after remaining stable in August. As a result, year-on-year inflation reached 1.7% in September, staying comfortably below the target established by the Central Bank of Paraguay, which is 3.5% with a tolerance margin of two percentage points upward or downward.

• Inflation projection for the end of 2026 adjusted from 3.5% to 3.0%.
• September year-on-year inflation stood at 1.7%, below the central bank target.
• Gross Domestic Product (GDP) growth for 2026 maintained at 4.5%.
• Monetary policy interest rate expected to remain unchanged until the end of 2027.

Economic scenario and interest rate

The exchange rate projected by the consultancy was 6.000 guaranis per dollar for the end of 2026, although the US currency has been trading close to 5.700 guaranis. Itaú Macro anticipates that the benchmark interest rate of the Paraguayan economy will remain unchanged until the end of 2027. At the same time, the expectation for Paraguayan GDP growth for 2026 was kept at 4.5%, supported by resilient consumption and a record agricultural harvest.

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