Uruguay’s inflation rate YoY for December 2025 was reported at 4.09%, according to the latest data from the Sigmanomics database. This figure represents a decline from November’s 4.32% and continues the downward trend from the 5.67% peak recorded in April 2025. The easing inflation reflects a combination of stable domestic demand, moderate wage growth, and controlled food and energy prices.

Drivers this month

• Food prices contributed 0.12 percentage points (pp), down from 0.25 pp in November.
• Energy inflation eased to 0.08 pp, reflecting stable global oil prices.
• Services inflation remained steady at 1.50% YoY, supporting core inflation stability.

Policy pulse

The Central Bank of Uruguay’s inflation target range is 3.00%–4.00%. The current reading of 4.09% slightly exceeds the upper bound but signals convergence toward the target. Monetary policy remains accommodative but vigilant, with no recent changes in the policy rate, which stands at 7.25%.

Market lens

Immediate reaction: The UYU/USD exchange rate appreciated by 0.30% within the first hour after the release, reflecting market confidence in inflation containment. Two-year government bond yields remained stable at 8.10%, while inflation breakeven rates edged down by 5 basis points.

Examining core macroeconomic indicators alongside inflation provides a fuller picture of Uruguay’s economic health. GDP growth for Q3 2025 was reported at 2.80% YoY, a moderate pace supporting stable demand. Unemployment remains low at 7.10%, while wage growth is contained at 3.50% YoY, consistent with inflation moderation.

Monetary Policy & Financial Conditions

The Central Bank’s policy rate has held steady at 7.25% since September 2025. Financial conditions remain neutral, with credit growth at 6.20% YoY and stable banking sector liquidity. Inflation expectations for 2026 are anchored near 3.80%, reflecting confidence in monetary policy credibility.

Fiscal Policy & Government Budget

Fiscal discipline continues, with the government targeting a primary surplus of 1.50% of GDP in 2025. Public debt stands at 60% of GDP, stable compared to 62% in 2024. Recent tax reforms aim to broaden the base without increasing rates, supporting fiscal sustainability and limiting inflationary pressures.

External Shocks & Geopolitical Risks

Uruguay faces external risks from commodity price volatility, especially soybeans and beef exports, which account for 30% of export revenues. Regional geopolitical tensions in South America, including trade disputes and political uncertainty in neighboring Argentina, pose downside risks to trade and inflation.

What This Chart Tells Us

Market lens

Immediate reaction: The UYU currency strengthened modestly post-release, reflecting market relief. Inflation-linked bond yields declined slightly, indicating reduced inflation risk premiums. Equity markets showed mild gains in consumer staples sectors, benefiting from stable input costs.

Looking ahead, Uruguay’s inflation trajectory depends on several factors, including global commodity prices, domestic demand, and policy responses. The Central Bank is expected to maintain a cautious stance, balancing growth support with inflation control.

Bullish scenario (20% probability)

• Global commodity prices stabilize or decline, easing imported inflation.
• Domestic demand growth slows moderately, reducing price pressures.
• Inflation falls below 3.50% by mid-2026, allowing for potential monetary easing.

Base scenario (60% probability)

• Inflation remains near 4.00% through 2026, consistent with the central bank’s target range.
• Monetary policy remains steady, with gradual adjustments if needed.
• Fiscal discipline continues, supporting macro stability.

Bearish scenario (20% probability)

• Commodity price shocks or regional instability drive inflation above 5.00%.
• Wage pressures and supply chain disruptions increase core inflation.
• Central bank forced to tighten policy aggressively, risking growth slowdown.

Uruguay’s inflation rate YoY of 4.09% in December 2025 reflects a positive trend toward price stability. The moderation from earlier peaks signals effective policy and stable macro fundamentals. However, external risks and structural factors require ongoing monitoring. The balance of risks suggests inflation will remain manageable, supporting steady economic growth and financial market confidence.

Investors and policymakers should watch commodity markets, wage trends, and geopolitical developments closely. Continued fiscal prudence and credible monetary policy will be key to sustaining this favorable inflation path.

Key Markets Likely to React to Inflation Rate YoY

Uruguay’s inflation data typically influences local currency strength, bond yields, and equity sectors sensitive to consumer prices. The following tradable symbols historically track inflation trends or react to macroeconomic shifts in Uruguay and the broader region.

• UYUUYU – Uruguay Peso currency pair, directly impacted by inflation and monetary policy.
• MERVAL – Argentine stock index, correlated due to regional economic integration and trade.
• BBVA – Major Latin American bank, sensitive to interest rate and inflation changes.
• BTCUSD – Bitcoin, often viewed as an inflation hedge in emerging markets.
• USDUYU – USD to Uruguay Peso, a key currency pair reacting to inflation data.

FAQs

What is the current inflation rate YoY for Uruguay?

The latest inflation rate YoY for Uruguay is 4.09% as of December 2025.

How does Uruguay’s inflation compare historically?

Inflation has declined from a peak of 5.67% in April 2025 to 4.09% in December, reflecting easing price pressures.

What are the main risks to inflation in Uruguay?

Key risks include commodity price volatility, regional geopolitical tensions, and potential wage pressures.

Takeaway: Uruguay’s inflation is on a downward path, nearing target levels, but external risks warrant cautious policy vigilance.