IMF Projects El Salvador Economy to Grow 4.5% This Year
The IMF's October outlook projects the El Salvador economy to grow 4.5% this year, up from 3.9% in 2025, in a country that uses the US dollar. The post IMF Projects El Salvador Economy to Grow 4.5% This Year appeared first on The Rio Times .
The International Monetary Fund (IMF) predicts El Salvador's economy to expand by 4.5% in 2026, surpassing all previous years from 2022 to 2025. This is the highest growth projection among Central American nations, with Guatemala at 4.0%, Honduras at 3.3%, and Panama at 5.0%. El Salvador adopted the US dollar as its currency in 2001, making its economy closely tied to US interest rates, jobs, and the money sent by Salvadorans living in the US.
The IMF projects a 4.5% growth rate for 2026, up from 3.9% in 2025, and expects it to drop to around 4.0% in 2027 and 3.3% from 2028 onwards. The real output growth is estimated at 4.5% in 2026, while inflation is projected to be 2.7% in the same year. Unemployment is expected to be around 4.3% in 2026 and gradually rise to 4.8% by 2030.
El Salvador is currently in a 40-month IMF loan agreement worth approximately US$1.4 billion, which requires the government to meet targets in the budget, public debt, and financial transparency. The US is El Salvador's largest trading partner and home to a large Salvadoran diaspora, making the dollarized economy a vital factor in the country's economic landscape.
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