In remarks to international investors in Washington, DC during the International Monetary Fund and World Bank Spring Meetings, Central Bank of Uruguay President Guillermo Tolosa reaffirmed the objective of bringing inflation to the 4.5% annual target and achieving it in a more symmetric way. He framed this as a move from an inflation range toward a specific numerical target that anchors communications and expectations, with inflation set out as the central bank’s primary objective. Tolosa said monetary policy will continue to rely on the policy interest rate as the fundamental instrument, while allowing the exchange rate to float freely in line with the market. He also pointed to efforts to strengthen the Central Bank of Uruguay’s independence and refine the inflation targeting regime, alongside expectations of improved macroeconomic coordination with the Ministry of Economy and Finance and the broader government to support disinflation without relying mainly on tradable-sector dynamics. He highlighted public support from President Yamandú Orsi for central bank independence and noted that while inflation has been at target for nearly two years, inflation expectations have averaged around two percentage points above the central target.
Central Bank of Uruguay 2025-04-28
Central Bank of Uruguay outlines shift to a 4.5% point inflation target and reiterates interest rate as main policy tool
Central Bank of Uruguay President Guillermo Tolosa, at the IMF and World Bank Spring Meetings, emphasized achieving a 4.5% inflation target more symmetrically, transitioning from an inflation range to a specific target. He reaffirmed the policy interest rate as the primary monetary tool and highlighted efforts to enhance central bank independence and refine the inflation targeting regime. Tolosa noted public support from President Yamandú Orsi and stressed improved macroeconomic coordination to support disinflation.