Costa Rica pauses hikes, joining Latin American trend

Central bank wants to give previous hikes time to filter into market rates

Central Bank of Costa Rica
The Central Bank of Costa Rica
Haakon S Krohn/Wikimedia Commons (

Costa Rica’s central bank held its policy rate at 9% on December 14, becoming the latest in Latin America to halt monetary tightening.

The central bank’s board of directors had previously raised rates eight times in a row between December 2021 and October 2022, from 0.75% to 9%. The cycle’s sharpest rise came in July, with a 200bp hike.

In its statement, the board said it was giving “a prudential space” to allow commercial interest rates to adjust to the previous round of policy rate hikes.

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