The Guatemalan economy is expected to close 2025 with 4.1% growth, and the same growth rate is projected for 2026. According to the Monetary Policy Evaluation Report, the construction sector has been the fastest-growing activity, playing a leading role in overall economic expansion.
The gross domestic product (GDP) is projected to end the year with a 4.1% expansion, as detailed in the monetary policy report reviewed by the Monetary Board (Junta Monetaria) during its session held on Wednesday, December 10, 2025. This projection reflects a solid performance across key productive sectors and sustained domestic demand.
Additionally, the 2026 growth forecast has been confirmed at 4.1%, following a comprehensive review of various macroeconomic variables and factors associated with national production. This outlook suggests continuity in economic momentum, despite ongoing global uncertainties.
Monetary Policy and International Context
Authorities from the Bank of Guatemala (Banguat) presented the results of multiple economic indicators, which collectively point to a favorable outlook for the Guatemalan economy, even amid a complex international environment. Particular attention was given to global conditions shaped by trade and migration policies implemented by the United States government during the year, which have influenced capital flows, remittances, and export demand.
Banguat officials also confirmed that the monetary policy framework for 2026 has already been approved and is pending official publication. The approval reinforces the central bank’s commitment to macroeconomic stability, low inflation, and prudent monetary management.
In nominal terms, Guatemala’s economy generated Q945.4 billion, while in real terms it reached Q636.7 billion, underscoring both price stability and real output growth.
Construction Leads GDP Growth with 8.3%
“There is a broad consensus that Guatemala needs to grow at 5% annually. The potential GDP growth rate is 3.5%, and we are currently growing at 4.1%. Over the medium term, we must become more productive, push structural reforms, and promote both domestic and foreign investment—public and private,” said Álvaro González Ricci, President of the Bank of Guatemala, when presenting the official figures.
Among the 17 economic activities that make up the GDP, construction recorded the highest growth rate at 8.3%, making it the primary driver of economic expansion. This growth reflects increased public infrastructure projects, private real estate development, and demand for commercial and industrial facilities.
Following construction, financial and insurance activities grew by 7.9%, supported by strong credit expansion, higher demand for financial services, and improved household and business confidence. The accommodation and food services sector, which includes tourism-related activities, posted growth of 5.4%, benefiting from a recovery in domestic travel and regional tourism.
These sectors collectively demonstrate how diversified growth is strengthening the Guatemalan economy beyond traditional agricultural and manufacturing activities.
Investment Needs to Reach 5% Annual Growth
To achieve sustained economic growth above 5% per year, Guatemala would require US$30 billion in investment over the next five years, equivalent to approximately US$6 billion annually. Authorities have already identified priority destinations for this investment, with a strong emphasis on infrastructure development.
Key areas include highways, rural road networks, ports, and airports, all of which are critical to improving logistics, lowering transportation costs, and increasing competitiveness. Importantly, officials stressed that infrastructure investment should not come at the expense of social spending, particularly in health and education, which are essential for long-term productivity gains.
When public investment materializes, it generates a multiplier effect that stimulates private investment. This dynamic serves as an incentive for businesses to expand operations, create jobs, and increase production, further strengthening the Guatemalan economy.
Monthly Activity Index, Inflation, and Exchange Rate Stability
Regarding year-end indicators, Banguat reported that the Monthly Index of Economic Activity (IMAE) reached 4.1%, aligning closely with the annual GDP projection. Inflation remained well under control, standing at 1.73% in November, with a year-end projection of 1.75%.
“This is a clear message that Guatemala offers stability,” emphasized the President of the Bank of Guatemala. Low and predictable inflation has supported consumer purchasing power and maintained confidence among investors and financial markets.
The average nominal exchange rate stood at Q7.72 per US dollar, influenced in part by strong family remittance inflows, which exceeded expectations. Remittances continue to play a crucial role in supporting household consumption, stabilizing the currency, and strengthening external accounts.
Outlook Toward 2026
Looking ahead, Guatemala’s macroeconomic fundamentals remain solid. Continued growth in construction, financial services, tourism, and infrastructure investment positions the country favorably within Central America. However, authorities acknowledge that reaching higher growth rates will require structural reforms, improvements in productivity, better public execution capacity, and sustained investment inflows.
If these challenges are addressed, the Guatemalan economy could move beyond its current growth ceiling and achieve a more inclusive and resilient expansion path in the coming years.