Monthly report: Uruguay

Resumen

The political landscape does not look very encouraging. Eyes are fixed on the future of treasury accounts whose deterioration is shockingly alarming. The halt on spending seems unlikely. Accor to investors, the rebalancing of public accounts by the Minister Astori does not suffice.

The economic outlook for the Uruguayan economy are not negative, but heterogeneities are large. Indeed, they were corrected downwards. For 2015, a 2.5% yoy growth is expected. Industry slightly recovered, advancing 1.6% yoy, if the effect of oil refining and pulp sector are excluded. However, bearing in mind the main indicators of domestic demand, slower growth in private consumption is foreseeable.

Inflation seems to shy away from the target range in the medium term. Wage inertia and the transfer of the devaluation of the Uruguayan peso to domestic prices prevail.

At the same time,the global environment is still less auspicious. China's slower growth, poor performance of major trading partners (particularly Brazil) and lower commodity prices will not help. Although the effect of reducing imports due to lower oil prices would be greater than the result of the decline in sales abroad, this year the trade deficit reduce.

Tabla de contenidos

Political contextCurrent situation and economic policyEconomic activity and labor marketFiscal situationMonetary policy, currency and inflationTrade balanceForecast