Macroeconomic Forecast Nicaragua

Inflation came in at 7.3% y-o-y in November, though it slowed slightly from 7.7% y-o-y in October, continuing to moderate from its August 2011 high. Inflation was driven by food prices, particularly perishable goods, as well as rising fuel prices, which were passed onto consumers. We forecast inflation to average 7.5% y-o-y in 2012, down from our estimate of 8.4% y-o-y in 2011, as our commodities team forecasts a moderation in Brent Crude prices from an average of US$109.5/bbl in 2011 to US$102.0/bbl 2012.

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