Uruguay's Minister of Economy Danilo Astori announced Wednesday the country's economy would expand 4.6% in 2007, after having finished the third year running of expansion above the region's average.
"The Uruguayan economy is going through a period of rapid expansion" said Astori who pointed out that "2006 is the third year running that the Uruguayan economy grows above the Latinamerican average, which is also relatively high in historical terms". Astori anticipated that in 2007, Uruguay will experience a 15% growth in gross investment in real terms and an 11% rise in exports, which in 2006 ended at an all time record of four billion US dollars. Another forecast for 2007 is the creation of 30.000 new jobs and an increase in real wages averaging 6%, "which is possibly the most important indicator for us", said Astori, who also forecasted a 4% GDP primary surplus and a consolidated deficit of 0.5%, percentages which he described as "historic". In 2006 Uruguay finalized its stand by agreement with the International Monetary Fund after reimbursing pending loans which helped the country climb out of the financial 2001/02 financial crisis. Central Bank president Walter Cancela revealed that during 2006, the institution purchased 1.7 billion US dollars in the money market, compared to 1.4 billion in 2005. On Wednesday also the consumers price index was made public showing that retail inflation in Uruguay reached 6.38% in the twelve months of 2006, which was in the range target of the Central Bank: 4.5% to 6.5%. However this was higher than in 2005 with 4.9% and inferior to the 7.59% of 2004. December's consumers' price index soared 0.37% compared to November's 0.04% and October's deflation of 0.2%, mainly spurred by housing and renting costs and the leisure industry. Actually of the main nine items making up the consumers' price index all increased in December with the exception of Transport and Communications which showed a slight decline, 0.09%.