LatinNews Daily - 23 January 2026

*The International Monetary Fund (IMF) has announced that its executive board has completed the sixth review for Paraguay under the Policy Coordination Instrument (PCI) and fourth review under the Resilience and Sustainability Facility (RSF), the final reviews under both arrangements. These reviews make available US$117m to authorities for disbursement under the RSF. An IMF statement released yesterday highlights that “Paraguay’s economy remains resilient despite global uncertainty”, with GDP growth “expected to stay robust in 2026 and thereafter, supported by macroeconomic stability and a wide range of reforms in train supported by the PCI and RSF arrangements”. The IMF projects Paraguay’s GDP will expand 3.7% in 2026, down from 4.4% in 2025. According to the IMF, Paraguay’s inflation is “under control” and expected to reach the central bank’s target of 3.5% in 2026. The Fund highlights that Paraguay’s current account is “expected to weaken short-term” due to foreign direct investment (FDI)-related imports “but should strengthen over the medium term as new exports come on stream” while foreign reserves “remain above adequacy thresholds”. The IMF also highlights that for Paraguay, “completing the fiscal consolidation plan remains essential for maintaining macroeconomic stability”, noting that the authorities are making “steady progress” towards reducing the fiscal deficit to 1.5% of GDP by 2026 and “remain committed to fulfilling this objective”. It adds that the PCI remains on track to meet its objectives “despite some missed targets, given compensating factors and the authorities’ policy commitments”.

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