Central Bank of the Dominican Republic Holds Monetary Policy Rate at 5.25%

The Central Bank of the Dominican Republic left its monetary policy rate at 5.25% in its January 2026 decision, citing higher global uncertainty and recent inflation pressures linked mainly to food supply shocks, while saying monetary transmission has been operating efficiently and supporting favorable financial conditions; over the past year, it held the rate at 5.75% through August 2025, cut by 25 basis points in September and again in October to 5.25%, and then held it through December. The 1-day repo rate remains at 5.75% and the overnight deposit rate at 4.50%. Annual inflation rose to 4.95% in December 2025, still within the 4.0% ± 1.0% target range, and the central bank expects headline and core inflation to be back within target by end-2026 as supply conditions normalize; economic activity grew 2.3% year on year in December, taking 2025 growth to 2.1%, with a gradual recovery to around 4.0% projected for 2026, while private-sector credit in local currency was expanding by about 8% in January. On the external side, the current account deficit is estimated at about 2.4% of GDP in 2025 and fully financed by projected foreign direct investment of USD 4.9 billion, while reserves stood at about USD 14.7 billion at end-2025. The central bank said the global backdrop remains uncertain, with resilient US growth, euro area activity constrained by geopolitical conflict and trade uncertainty, and higher geopolitical tensions pushing WTI oil to around USD 65 while gold remained at