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Economy / Nicaragua

Macroeconomic Forecast Nicaragua

February 2011 | Macroeconomic Forecasts

BMI View: Consumer price inflation (CPI) hit a 23-month high in Nicaragua in December, reaching 9.2% y-o-y, and since most of this price pressure is a result cost-push rather than demand-pull inflation, we expect it to place a serious strain on private consumption levels in H111. At present we are projecting a gradual improvement in household spending throughout 2011, rising 3.0% in real terms from 2010 levels, but should higher global commodity prices keep CPI elevated well into the second half of the year, this projection could be significantly revised down, as could our 3.3% real GDP growth forecast for 2011.

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