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Economy / Honduras

Macroeconomic Forecast Honduras

July 2010 | Macroeconomic Forecasts

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BMI View: Honduras's foreign reserves are continuing to fall at an alarming rate, with April data showing a 17.4% year-on-year (y-o-y) contraction, up from the 14.3% y-o-y decline in March. With little prospect of a marked narrowing in the country's current account deficit (we are projecting a shortfall of 8.8% of GDP in 2010) over the medium term, and the financial account still suffering from heightened political risk, we are growing increasingly concerned that Honduras could be moving towards a balance of payments crisis.