Macroeconomic Forecast El Salvador

BMI View: El Salvador remains in the economic doldrums, with December data showing the country's seasonally adjusted economic activity index remains 7.5% below 2007 highs. While the index has posted moderate year-on-year growth since March, month-on-month expansion has averaged just 0.1% since April 2010, suggesting that there is very little momentum behind the recovery. With industrial production growing an equally poor 0.4% y-o-y in January, we hold to our forecast for very modest real GDP growth of 2.1% in 2011.

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