This week the first 100 days of the mandate of the president of the United States, Donald Trump, who has implemented a commercial policy with a tariff plan for all countries, including Guatemala, and has intensified the commercial war with China.
The decision of the JM of Guatemala was released on the night of Wednesday, April 30, 2025, after the decision to maintain in 4.50% the leading rate of monetary policy was announced.
With the downward review of the annual growth estimate of the Gross Domestic Product (GDP) of Guatemala for 2025 it was decided to adjust it from 4% (estimated in December) to 3.8% (according to the review carried out on April 30).
While by 2026 it remained constant in 3.9%, explained Álvaro González Ricci, president of the Bank of Guatemala (Banguat) and the JM, and Johny Gramajo, economic manager of the Banguat, accompanied by other officials of the entity.
The decision is derived from the effect in the internal field due to the high uncertainty environment at an external level, which affected the economic activity perspectives of the main commercial partners, including the United States, to which the International Monetary Fund (IMF) adjusted its economic performance downward.
For Guatemala, the IMF had estimated a growth of 4.1%, according to its most recent report released last week. However, the Banguat authorities clarified that this report was prepared before April 2, when the United States Tariff Plan was announced, so it still does not reflect the effects of that measure.
For next June the arrival of an IMF delegation is expected, with which this issue will be addressed.
Despite the change in forecasts, Guatemala remains within the range of its growth potential, which is around 3.5%. The World Bank also estimated at that figure last week, authorities said.
The United States established on April 2, 2025 tariffs with a 10%global rate, which includes Guatemala (except Mexico and Canada, which maintain the preferences of the FTA).
Low forecast of exports and imports
Foreign trade forecasts were also reviewed. For exports, a 5% growth was estimated at the end of 2025, but they adjusted to a central value of 2%, with an upper limit of 3.5% and a lower negative of -0.5%.
An affectation derived mainly from the economic slowdown and the reduction of consumption in the United States, as well as a drop in the volume of exports.
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As for imports, growth projections were 7% in the central value, but were reduced to 5%. One of the factors that influence the most is the decrease in the price of oil.
Downward sectors
From a classification of 17 economic sectors, six were reviewed down:
- Agriculture, livestock, forestry and fishing: from 1.1% to 0.8%
- Manufacturing industries: 4% to 3.4%
- Trade and vehicle repair: from 3.7% to 3.6%
- Transport and storage: from 3.8% to 3.6%
- Accommodation activities and food services: 4.6% to 4.4%
- Financial and insurance activities: from 7.6% to 7.3%
Ricci and Gramajo indicated that the decline in the estimate of economic growth responds to factors derived from the external environment, mainly high levels of uncertainty, which have deteriorated economic trust and are reflected in the IMF revision.
These factors could cause exports to decrease. In the case of Guatemala, a disadvantage is resentful against Mexico, which maintains preferential access without tariff.
Actions to mitigate the impact
Among the measures contemplated to mitigate economic slowdown, Ricci mentioned that it is necessary to wait for the final conditions of US policies, although repercussions are expected.
He added that the Ministry of Economy (Mineco) informed the JM to progress in solutions to overcome commercial barriers, and are already in high -level negotiations with the United States.
One of the actions will be to eliminate the 10%tariff, which will be one of the main issues to be addressed by diplomatic route. It will also seek to improve the productivity of the country and analyze the possibility of expanding the fiscal space to support certain sectors.
Internationally, the environment is of economic slowdown, including the main commercial partner of the country: United States.
Stable inflation and upward remittances
Regarding the inflationary rhythm, the 1.57% observed in March 2025 continues below the lower limit of the inflation target determined by the JM, which is 4% ± 1 percentage point. This is mainly due to the dissipation of internal supply shocks, especially in food and fuel. However, world protectionist policies could generate external inflationary pressures, authorities warned.
As for family remittances, this is one of the variables that were reviewed up. The initial estimate was a 6% growth in the central value, but now it is expected to close at 9%, with an amount of US $ 23,450 million for the closure of 2025, and around US $ 24.8 billion for 2026.
The #Juntamoneriain its session held this April 30, based on the integral analysis of the external and internal economic situation, after evaluating the balance of inflation risks, he decided by majority maintaining the level of the leading interest rate of monetary policy … pic.twitter.com/d3fham20JZ
– Bank of Guatemala (@Banguat) May 1, 2025
Internal political atmosphere
Asked about the impact of the political environment among the state agencies on economic growth, or in the decisions of investors, Ricci replied that he considers that any type of problems between these agencies – which have not only been observed now now, but also in electoral times – generates uncertainty, which causes a pause in the foreign investment flows and in the local investment.
Regarding the interviews that the Guatemala delegation held last week in the United States with some banks, Ricci indicated that this aspect has been highlighted, although for the moment it is not affecting. However, he explained that the problems that become news generate perception, which influences economic expectations.
He affirmed that the bank works closely with the monitoring of these expectations at 12, 24 and 60 months, and that the inflation perspectives are anchored to the goal. He added that, beyond perception, the fact that in recent weeks there has been no activity in Congress or approval of new laws, are situations that could represent a risk.
Adjusted growth projections are located at 3.8%, more than 1%, and that range already contemplates these factors, which are not new in Guatemala, Ricci said.