Friday 01 August
2008, San José, Costa Rica
Menos Pachanga, Menos
Fiesta. Time To Tighten
The Belt, Says Central
Bank President
Annual Romeria In
Its Last Days
Tax on International
Banks To Finance Diesel
Subsidy
Supermarkets
Overcharging Customers
Berrocal For President
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Menos Pachanga, Menos
Fiesta. Time To Tighten
The Belt, Says Central
Bank President
Costaricans have to "apretarse
la faja" (tighten their
belt), be cautious and
rationalize their
spending, according to
the president of the
Banco Central de Costa
Rica (BCCR), Francisco
de Paula Gutiérrez.
The inflation forecast
for this year has been
revised to 14%, up from
the 8% average the
Central Bank forecast in
January, which will mean
higher prices and less
disposable income.
The Central Bank
preisdent says that
increases in the price
of food and imported
goods, mainly due to the
high cost of oil and the
recent changes in the
exchange rate - as well
as a rise in interest
rates, should worry
Costa Ricans and take
cautionary measures.
"We have to learn to
rationalize. It is
irresponsible to assume
to continue spending as
the salary was double.
We must tighten out belt
a bit, but without
bottlenecks, so that we
spend on what's really
important for each
family", said Gutiérrez.
Gutiérrez, however,
added that 2009 will be
a better year for the
Costa Rican economy as
the price increases are
not expected to be as
sharp.
The bank president, with
respect to the rise in
interest rates, said he
sees a slow rise and
nothing abrupt.
In addition to the rise
in inflation forecasts,
the Central Bank also is
expecting a slowdown in
economic growth, saying
it forecasts a growth of
only 3.3% instead of the
3.8% forecast in
January.
For now, Gutierrez said,
we must continue leaving
the car at home one day
or more a week and
prioritize spending.
For his part, Roy
González, general
manager of the Central
Bank, he explained that
an increase in the price
of imported goods will
continue if the exchange
rate of the dollar and
colon stay at the high
levels.
Gutiérrez added that
Costa Ricans should
analyze their ability to
pay before taking out a
loan. The advice of the
bank president is not to
get into debt in dollars
if earnings are in
colones.
The Central Bank
president also warned
about speculating in the
exchange rate of the
dollar.
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