2026.09.2119:14:31UTC+00Paraguay Holds Key Interest Rate at 5.50%

Paraguay’s central bank left its policy rate unchanged at 5.50% at its September 2026 meeting. The bank stated that economic activity continues to perform well and remains consistent with its projected 4.5% growth for 2026.

Annual inflation is still low, largely reflecting the behavior of goods prices, which rose 0.4%, driven mainly by non-energy goods. By contrast, inflation in services and rents is hovering around 3.5%. The bank projects year-end inflation at 3.3%, with a gradual convergence toward the target over the monetary policy horizon. Inflation expectations also remain anchored at the target.

The external environment, however, continues to face risks. These include volatility in international petroleum product prices and uncertainty stemming from the conflict in the Middle East, particularly its potential impact on supply conditions and energy prices. In addition, market participants expect at least one more increase in the federal funds rate before the end of the year.