Macroeconomic Forecast Uruguay

August 2006 | Macroeconomic Forecasts

Inflation hit 6.7% in June - its highest level since 2004. The upward trend in price rises, observed from around August last year, can be chiefly attributed to robust real GDP growth levels, which came in at 7.2% in Q106. June's data is in accordance with our year-end 6.8% CPI projection. Looking forward, we expect inflation to slow down in 2007. Next year should see the peso appreciating and a deceleration in real GDP to around 3.0%. Coupled with a government outwardly committed to reining in the fiscal deficit, we forecast a fall in inflation to 4.0% in 2007.

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