Analysis by Region - Emerging Markets - Uruguay

Analysis by Region - Emerging Markets - Uruguay

We've cut our Uruguay 2023 GDP forecast to 0.7% from 1.8%, mainly due to carryover from the sharp contraction at the end of last year. Hurt by the ongoing drought, primary activity plunged to -21.5% y/y in Q4 2022, tipping the economy into a technical recession. GDP expanded by 4.9% in 2022, undershooting our latest forecast by 0.4ppts. In the short term, risks are tilted to the downside as food commodity prices cool, global trade slows, and policy tightening feeds through to the domestic economy.