US rate hikes sure to have an impact on Dominican economy
Santo Domingo.- The US Federal Reserve approved Wednesday the highest interest rate hike in that country since 1994 (to be between 1.5-1.75%), which will not only impact that economy, but analysts already anticipate its effects on others such as the Dominican.
“The increase in the interest rate in the United States causes the interest rate to increase throughout the world and, therefore, a first effect is an increase in the interest rate at which the Dominican Republic will place new debt in the coming months,” projects the economist and former general director of Internal Taxes, Magín Díaz.
He analyzes that the additional local impact will depend on whether the increase in interest rates in the United States – to fight inflation – causes a slowdown in its economy. “If that’s the case, then we’ll feel the impact through fewer remittances, fewer exports, and less tourist flow,” he says.