Inflation in Latin America maintains an uneven pace in 2025 with some countries that have managed to stabilize prices while others continue to be affected by domestic consumption, political instability and financial costs, in a scenario of slow adjustments that keeps Brazil and Argentina at the extremes and Mexico, Chile and Colombia with sustained advances.
In Brazil, year-on-year inflation reached 5.17%, above the official goal of 4.5%, driven by strong consumption and a labor market at full employment.
The Central Bank maintains the interest rate at 15%, the highest since 2006, which has slowed economic activity. In São Paulo, the basic basket costs 842.26 reais (157 dollars), 60% of the minimum wage, reflecting the high cost of living.
Argentina registered inflation of 31.8% in September, the lowest since 2018 after 17 months of deceleration.
Prices accumulated an increase of 22% between January and September and the year is expected to close at 29.8%. The Government of Javier Milei hopes to reduce the rate to 10.1% in 2026, although private projections place it closer to 18%.
Mexico kept inflation at 3.76% annually in September, close to the 3% target of the Bank of Mexico, which reduced its interest rate to 7.5%, the lowest level since 2022. The price index rose only 0.23% monthly, consolidating its position as one of the most stable economies in the region.
You may be interested in: Mexico’s economic activity fell 0.9% year-on-year in August
Inflation in Latin America: advances in Mexico and Chile contrast with Brazil and Argentina
In Chile, inflation was 4.4%, within what was forecast by the Central Bank, which expects to reach 3% in 2026. Under the government of Gabriel Boric, the country maintains moderate growth, with a projection of 2.1% for this year.
Colombia registered inflation of 5.18%, with a monthly rebound of 0.32%. The Bank of the Republic maintained the interest rate at 9.25% and plans to close the year at 5%, while the peso remains below 4,000 per dollar.
In Bolivia, accumulated inflation between January and July reached 16.92%, more than double the 7.5% officially projected for 2025. International reserves were reduced to 2,807 million dollars, far from the record of 15,122 million reached in 2014.
In Central America, the International Monetary Fund (IMF) foresees stability with low price levels. Panama leads regional growth with 4% of GDP and negative inflation of -0.1%, followed by Guatemala and Honduras with 3.8% and rates of 1.7% and 4.6%. Costa Rica will grow 3.6% with inflation of 0.4%.
Dominican Republic and Nicaragua will reach 3% with moderate inflation. El Salvador and Belize will remain below 2.5% expansion and 1.5% inflation, respectively.
In Venezuela, the Central Bank reported a growth of 8.71% of GDP in the third quarter, driven by the recovery of the oil sector, although the United Nations Development Program (UNDP) warns that inflation will close 2025 at 275%, one of the highest in the world, which maintains the loss of purchasing power and monetary instability.
According to the Economic Commission for Latin America and the Caribbean (ECLAC), inflation in the region would remain stable, while the International Monetary Fund (IMF) estimates that it will reach 7.2% in 2025, taking into account the effect of economies with very high inflation such as Venezuela.
With information from EFE.
Follow us on Google News to always stay informed
