A trending decline in Costa Rica’s Basic Passive Rate (BPR) will continue on Thursday, when the indicator will drop from 8.30 percent to 8.05 percent, the seventh consecutive decrease since December.
This new decrease was posted on the Central Bank’s website on Wednesday.
Along with the Central Bank, President Laura Chinchilla’s administration announced weeks ago that they would take measures to reduce domestic interest rates that are attracting capital from foreign investors taking advantage of the country’s attractive interest rates in colones.
Central Bank authorities have detected large amounts of U.S. dollars entering the country since October, targeting short-term investments after being exchanged into local currency.
The first decrease was approved on Dec. 27, when it went from 9.50 percent to 9.30 percent. Experts believe that the BPR downward trend is likely to continue and approach levels between 7-7.5 percent in coming days.
The BPR indicator is used as a reference to calculate interest rates paid by loans in colones in Costa Rica’s banking system.