BCU interest rate cuts around the corner?

URUGUAY - Report 27 Dec 2022 by Esteban Fernández Medrano

Recent declining inflation and activity indicators suggest that the BCU monetary tightening might be coming to an end. Contrary to the last Monetary Policy Committee on November the 15th, where the monetary authorities announced another 50bps hike of the reference rate to 11.25%, we would not be surprised if in the coming months the BCU halts and eventually starts reverting the interest rate rally.

The next Monetary Policy Committee meeting will be held on Jan the 4th. December CPI will not be officially known at that time, but WPI will be, representing another price signal to the BCU officials.

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