The International Monetary Fund released a press release and staff report for Paraguay’s sixth review under the Policy Coordination Instrument and fourth review under the Resilience and Sustainability Facility arrangement, finding that economic activity remains strong despite global uncertainty and that macroeconomic conditions remain broadly stable. The report points to favorable medium-term growth prospects supported by ongoing structural reforms, with inflation under control, public debt at prudent levels, and foreign reserves above adequacy benchmarks. Fiscal consolidation is progressing in line with the authorities’ plans, and adherence to the Fiscal Responsibility Law is expected to be restored in 2026 for the first time since 2018. Risks to the outlook are described as balanced, with adverse weather shocks a key downside risk and stronger-than-expected foreign direct investment inflows an upside possibility.
International Monetary Fund 2026-01-23
International Monetary Fund publishes Paraguay review report highlighting strong activity and expected return to the Fiscal Responsibility Law in 2026
The IMF's sixth review under the Policy Coordination Instrument and fourth under the Resilience and Sustainability Facility for Paraguay highlights strong economic activity and stable macroeconomic conditions, with favorable medium-term growth prospects supported by structural reforms. Inflation is controlled, public debt is prudent, foreign reserves are adequate, and fiscal consolidation aligns with plans, with Fiscal Responsibility Law adherence anticipated by 2026.