The central bank of Paraguay decided unanimously to cut its benchmark interest rate by 25 bps to 4 percent on its September 23rd 2019 meeting. The move follows a 25bps slash in the previous meeting and leaves the rate at its lowest level since 2010, amid lower inflation and concerns regarding global economic growth. Policymakers noted that the annual inflation rate fell to 2.8% in August from 3.1% in July due to cost of food and added that inflationary pressures will not be anticipated in the coming months. The Committee said that the decision is appropriate with the convergence of inflation to the target of 4% and that they will continue to monitor domestic and external macroeconomic variables and take actions if necessary. Interest Rate in Paraguay averaged 5.91 percent from 2010 until 2019, reaching an all time high of 8.50 percent in August of 2011 and a record low of 3.50 percent in November of 2010.
Interest Rate in Paraguay is expected to be 3.75 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Paraguay to stand at 3.75 in 12 months time. In the long-term, the Paraguay Interest Rate is projected to trend around 3.50 percent in 2020, according to our econometric models.