Guatemalan economy exceeds forecast in 2025 with 4.3% and faces external pressure for this year

An upward bias was the result of the review of the Guatemalan economy by the Monetary Board (JM), which raised the closing estimate for 2025 from 4.1% to 4.3%.

At the moment, the growth forecast for the national economy for 2026 remains between 3.1% and 5.1%, with a central value of 4.1%. The new estimates will be released on April 22, when it will be defined whether they remain upward or downward, derived from the international geopolitical context and the increase in the prices of refined fuels since the end of February.

With the official result in 2025, the economy generated Q947 thousand 05.5 million in nominal terms, that is, a growth of 7.8%, and in real terms it reached Q637 thousand 729.7 million, equivalent to 4.3%, central banking authorities explained.

In 2024, the economy grew 3.7%, so the average for 2010-2024 is 3.5%according to the official report.

Consumption and construction lead growth

Álvaro González Ricci, president of the Bank of Guatemala (Banguat), and Jonhy Gramajo Marroquín, economic manager, explained that the main components of spending that affected growth and were adjusted upwards are private consumptionimports of goods and services, as well as gross fixed capital formation.

In addition, they announced that the main economic activities that influenced growth reported positive performance; construction stands out, with 8.5%; financial and insurance activities, with 8.4%; accommodation and food service activities, with 6.8%; manufacturing industries, with 2.6%, as well as transportation and storage, with 4.8%.

“The economy in 2025 exceeded 4.1%, which was the originally estimated value, and now it is 4.3%, which is a very positive figure for the country, since it grows above the potential GDP, of 3.5%,” explained González Ricci.

Remittances, key to economic growth

The official report shows that, in terms of private consumption, growth was associated with greater household disposable income, linked to the increase in the total number of workers and the average salaries of contributors to the Guatemalan Social Security Institute (IGSS).

Also noteworthy is the greater income of foreign currency from family remittances, that last year they registered an extraordinary growth of US$25 thousand 530.2 million (about Q195 thousand 304 million)as well as the behavior of bank credit for consumption.

Regarding imports of goods and services, There was an increase explained by the greater imported volume, especially in construction; raw materials and intermediate products for industry; fuels and lubricants; and capital goods for transportation, industry, telecommunications and construction.

There was also an increase in the import of services linked to tourism and maritime and air transport.

In gross fixed capital formation, an increase was recorded associated with greater construction of national assets for common use by the general government. Also influential were the progress in the construction of the Escuintla-Puerto Quetzal highway, a work that is carried out under the public-private alliance scheme, as well as the private roads Xochi-El Corredor de las Flores and the Corredor Verde.

On the other hand, there was an increase in the construction of national assets for non-common use, especially by local governments, as well as residential and non-residential buildings.

“We observed significant growth in construction, as well as in financial and insurance activities,” he stated.

Inflation rising due to external pressure

Central banking officials advanced the scenarios of the new estimate for 2026, which already include the possible effects on the national economy, especially in the general price level, derived from the external situation; that is, the international geopolitical conflict, as well as the constant increase in fuel prices since the end of February.

“There is no final decision on what may happen, and although there is a waiting period (truce), it will depend on the international price of a barrel of oil, which is transferred to the price of fuel and has an impact on first and second round inflation. It is a difficult scenario to predict and we cannot get ahead of ourselves,” they explained.

In any case, they recognized that inflation in Guatemala was 1.56%, a level that not all countries registered; However, in March it rose around 1%, and stood at 2.50%. Therefore, there is still room to work with some slack, if the international conflict does not continue to escalate.

“The monetary space and inflation are still in ranges that seem like we would not have anything to worry about too much, but this will be evaluated by the technical bodies, waiting for the truce,” added the president of Banguat.

In this regard, he stressed that maintains the economic growth forecast for 2026.

Economic adjustment, part of technical evaluation

For the analyst of the Social Studies Research Association (Asies), Érick Coyoy, the adjustment to the economy, as occurred in 2025 by the Monetary Board (JM), is a normal evaluation, since other closing factors are considered in greater depth.

He indicated that a general review of variables that were not available in December, when the first figures were published, is being carried out.

In his opinion, the upward adjustment of the economy last year would be explained mainly by the extraordinary behavior of the family remittanceswhich registered an increase of almost 20% compared to 2024, which was unexpected and was linked to immigration policy decisions in the United States.

On the other hand, in exports, coffee was the most favored product, with a substantial increase in prices due to harvest problems in Brazil and Vietnam, which reduced global supply and favored national producers, with an increase of more than 30% in grain exports.

Unlike other items, such as clothing and textiles, which did have a slight reduction due to the tariff policy in the United States, said the Asíes consultant.