Honduras raises Monetary Policy Rate to 6% to combat inflation

The Central Bank of Honduras (BCH) has increased the Monetary Policy Rate (TPM) by 25 basis points, raising it from 5.75% to 6% to combat inflationary pressures.

Banking institutions, including the Honduran Association of Banking Institutions (AHIBA), have expressed support for the measure. Officials and economists emphasize that this increase will not result in an immediate or automatic rise in consumer loan rates. Instead, any impact on credit costs for households and businesses is expected to be gradual, as individual banks determine rates based on their specific liquidity, funding costs, and market conditions.

Estimates suggest the transmission of this policy could take between four and six months to manifest in the broader economy. While the move is viewed as a technically correct measure to stabilize prices, experts note that external factors such as global economic uncertainty and food sector conditions will also influence inflation.