Uruguay Interest Rate

The Central Bank of Uruguay reduced its policy rate by 25 bps to 9.00% in July 2025, maintaining a contractionary stance to support the ongoing convergence of inflation toward the 4.5% target. Inflation stood at 4.59% in June, in line with the target range, while core inflation likewise eased but remains subject to price rigidities in non-tradable goods and services. The BCU’s projections were revised lower, showing inflation remaining around 4.5% over the next two years. Global dollar weakness and reduced commercial and geopolitical uncertainty have mitigated international price volatility. The Board emphasized the importance of consolidating inflation at target and reinforcing the downward trajectory of expectations, noting that further rate cuts could be warranted if inflation and expectations evolve as projected.