Macroeconomic Forecast Honduras

The alarming political events in Honduras, and the likely impact on fixed investment a public spending, have convinced us to revise down our real GDP growth assumptions for 2009. We now see real GDP growth coming in at -3.7% this year, down from a previous projection of a 2.6% contraction. In an ominous sign, May's economic activity index collapse by 10.5% y-o-y - the worst rate of contraction on record. Looking longer-term, we expect the country to remain a regional underperformer, with real GDP expected to post modest expansion of just 0.3% next year.

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