The Central Bank of the Dominican Republic (BCRD) held its monetary policy rate at 5.75% in May 2025, citing persistent global uncertainty, elevated interest rates in the United States and domestic inflation that has remained within the 4.0% ± 1.0% target range for the past two years; the rate has been unchanged at 5.75% since at least January 2025, following cumulative cuts of 125 basis points in the second half of 2024. The BCRD also left its one-day repo rate at 6.25% and its overnight deposit rate at 4.50%, while noting active liquidity management in early 2025 and macroprudential measures adopted by the Monetary Board to strengthen financial stability. Headline inflation stood at 3.71% in April 2025 and core inflation at 4.13%, with the central bank’s models indicating both headline and core inflation will remain within target in 2025 and 2026; economic activity expanded 2.5% year on year in January-April 2025, and the BCRD expects growth of around 3.5%-4.0% in 2025, while private credit in local currency was growing by about 8% year on year at end-May. On the external side, the peso had appreciated by about 3.3% in May 2025 and international reserves were above USD14.7 billion, equivalent to about five months of imports. The BCRD said the global backdrop was marked by weaker US and euro area growth prospects, trade tensions, geopolitical conflicts and higher inflation expectations in the US linked to tariff increases, and it reiterated that it will continue monitoring t
Central Bank of the Dominican Republic2025-05-27
Central Bank of the Dominican Republic Holds Policy Rate at 5.75%
The Central Bank of the Dominican Republic left its May 2025 monetary policy rate unchanged at 5.75%, with the one-day repo rate at 6.25% and the overnight deposit rate at 4.50%, citing persistent global uncertainty, elevated United States interest rates and domestic inflation remaining within the 4.0% ± 1.0% target range. Headline inflation stood at 3.71% in April 2025 and core inflation at 4.13%, both projected to remain within target in 2025 and 2026, while the central bank expects 2025 growth of around 3.5%-4.0% and reported international reserves above USD14.7 billion.