SAN JOSE, Feb 2 (Reuters) - Costa Rica’s central bank said on Monday is had lowered interest rates 50 basis points to 4.75 percent to take advantage of a steep decline in oil prices to help meet its 2015 economic growth target of 3.4 percent.
Costa Rica is an energy importer, so low oil prices allow the central bank to try and raise growth with less risk of stoking inflation, which was 5.1 percent in 2014.
“For the next quarters, we estimate there will not be additional demand pressure on inflation, the exchange rate will continue relatively stable, and we will see the manifestation of the reduction in the price of hydrocarbons,” the central bank said in its macroeconomic projections for 2015-2016.
The rate cut was announced on Saturday, but took effect on Monday. In Saturday’s projections, the central bank set an inflation target of between 3 percent and 5 percent for 2015. (Reporting by Kike Pretel; Editing by Alan Crosby)