Santo Domingo.- Dominican Republic’s Central Bank on Monday announced that its benchmark rate will remain at 5% annually, a decision it affirms took into account the balance of risks around inflation forecasts, market expectations and the global environment.

“In June the annual rate of inflation stood at 1.91%, remaining below the target range. The annual core inflation associated with monetary conditions, stood at 1.62%. Forecasting models predict that inflation would converge to the target of 4.0% ± 1.0% at the monetary policy horizon of 24 months,” the Central Bank said in an emailed statement.

Dominican Republic Central Bank keeps benchmark rate at 5% on upbeat trends

It said the disturbances emerged after Brexit in international financial markets, mainly Europe, prompted a rebound of stock indexes, while capital flows to emerging economies have increased. “The dollar, the international reserve currency, remains strong and is expected to continue to appreciate in the coming months. Oil and gold prices, important minerals for the Dominican economy remain in the vicinity of US$45 per barrel and US $1.300 troy ounce respectively.”

The Central Bank said local economic activity and domestic demand, “observed a positive trend in the short term by experiencing a higher growth potential, together with a range of low and stable prices.”

Great news the Dominican Republic Central Bank keeps benchmark rate at 5% on upbeat trends

It adds that credit to the private sector in domestic currency grows an annual rate of around 11.3% to July. “Total loans to the private sector, including foreign currency funding, expands around 13.6% during the same month, above the nominal GDP growth.”