Itaú BBA - Macro Scenario – Uruguay: Central bank to change monetary policy instrument

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Macro Scenario – Uruguay: Central bank to change monetary policy instrument

August 11, 2020

The monetary policy committee has started a process to change the monetary policy instrument.

For the version with all charts and tables, please open the attached pdf file
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The monetary policy committee has started a process to change the monetary policy instrument. The central bank would therefore abandon the objective of monetary aggregates in favor of a reference interest rate scheme.

Both inflation and inflationary expectations remain above the central bank's target range. Our inflation forecast for 2020 is 10%.

Despite the outbreak of COVID-19, the situation seems to be under control, allowing for a progression toward a new normal. We maintain our forecast of a 4% drop in GDP this year.

For the version with all charts and tables, please open the attached pdf file



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