Guatemala: Today’s strengths could become tomorrow’s weaknesses

​Robust performance ahead

Economic growth in Guatemala is likely to accelerate, from +3.0% in 2017 to +3.4% in 2018 and +3.8% in 2019. Strong performance of the US economy should support activity in Guatemala in two ways. First, export growth should accelerate. Second, and more importantly, robust consumer spending could be buoyed by remittances flows from the US, on the back of continued employment gains in the American labor market. Consumer spending accounts for about 85% of GDP in Guatemala. Inflation should remain stable (4.3% in 2017, 4.2% in 2018, 4.0% in 2019) as oil prices stay at moderate levels.