Guatemala Interest Rate

The central bank of Guatemala unanimously kept its key interest rate at 5% for the sixth consecutive meeting in its final session of 2023 in November, following a total of 325bps rate increases since April 2022. Policymakers stated that the decision aims to align inflation with the central bank's target range of 4% ± 1% for 2023-2024 without hindering growth. Inflation accelerated for the second consecutive month, reaching 4.98% in October 2023, up from 4.69% in the previous month, and is expected to end the year at 4.95%. The statement acknowledges the better-than-expected performance of global economic activity in the first half of the year. However, it notes a local loss of momentum in the second half, attributing it to factors such as tighter monetary policy and declining confidence amid persistent downside risks. The Monetary Board reaffirms its commitment to taking necessary measures to keep inflation within the target range.