INSUBCONTINENT EXCLUSIVE:
economy.This move comes as the country faces unusual pressure: prices have not just slowed in growing, they have actually dropped
In June 2025, official figures show inflation stood at -0.22%.While a slight drop in prices seems attractive, steady deflation signals weak
demand and can hurt business investment and hiring
ticked up from 6.9% to 7.5% since late 2024, according to government data
These changes reflect softer demand for exports, fewer visitors in tourism, and the impact of bad weather on farming.Nearly half of bank
deposits and most big loans in Costa Rica are held in U.S
dollars, not the local currency
This partial dollarization means any change in global conditions or American interest rates quickly affects households and businesses in
Costa Rica.Costa Rica Cuts Rates as Economy Faces Deflation and Fragile Growth.(Photo Internet reproduction)More than a third of the
Fragile Growth Tested by Climate RisksCosta Rica also faces real climate risks: the majority of people and business assets are in areas
threatened by floods and natural disasters, according to the World Bank.These risks can damage growth and make the economy more fragile
The Central Bank insists that lowering interest rates is meant to balance current deflation, encourage lending, and keep business activity
going.Every step by the Bank is closely watched, because even small changes in rates or inflation move through the deeply connected economy
Business leaders and households are keeping a close eye on what happens next, hoping for stability and relief from mounting pressures.
