Central Bank of Costa Rica leaves rates unchanged in January

Central Bank begins year with a rate hold: At its meeting on 22 January, the Central Bank of Costa Rica (BCCR) maintained its policy interest rate at 3.25%—a near four-year low—following December’s 25-basis-point cut, which has yet to fully transmit through the economy.

Below-target inflation and expectations prompt BCCR to hold steady: The decision to keep its interest rate steady was primarily influenced by headline and core price pressures, which ended 2025 below the Central Bank’s tolerance range of 2.0–4.0%, with a 1.2% decline and a 0.1% rise, respectively. Both inflation metrics have undershot the lower bound of the target range since early 2023. These subdued price pressures are attributed to external supply shocks, such as cheaper imported raw materials. The BCCR expects these factors will continue to keep inflation low in the coming months; this, along with subdued inflation expectations, motivated the Central Bank’s cautious approach. At the same time, the economy is already performing well, giving the Bank ample room to hold rates steady.

Most panelists see rate unchanged in 2026: The BCCR did not provide explicit forward guidance. Most of our panelists expect the policy rate to end 2026 at its current level. The next meeting is scheduled for 26 March.

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