Dominican Republic Will See Lower Interest Rates With Below-Target Inflation

  • The Banco Central de la República Dominicana (BCRD) will continue its rate-cutting cycle through end-2019 given below-target inflation in the Dominican Republic and increasing headwinds to global growth.
  • A more accommodative monetary policy stance by the US Federal Reserve and low global energy prices will allow the BCRD to keep rates low in the coming quarters.
  • Fitch revised its end-2019 and end-2020 interest rate forecasts to 4.25% and 4.50%, from 5.00% and 5.25% previously, to incorporate the expectation that the BCRD will look to support economic activity amid slowing global growth.

(Source: Fitch)