Paraguay's Ministry of Economy and Finance (MEF) presented its financial situation report (Situfin) on Tuesday, confirming a fiscal deficit of 3.1 trillion guaraníes (about US$485.3 million) between January and April 2026. The amount equals 0.8% of gross domestic product (GDP), within the 1.5% fiscal limit set for the year.
In annualized terms (last 12 months), the deficit reached 8.6 trillion guaraníes (approximately US$1.2 billion), or 2.2% of GDP, according to the MEF technical team, led by Economics Manager Nathalia Rodríguez and Macro Fiscal Policy Director General Marcelo Rodríguez.
The first four-month result reflects, on one hand, the "moderate dynamics" of fiscal revenues, affected mainly by lower non-tax inflows and the exchange-rate impact on external collection. The 2026 National General Budget assumed a dollar above 7,800 guaraníes, but the US currency has been trading around 6,100 guaraníes. On the other hand, the MEF points to the behavior of public spending, linked to operational commitments in strategic sectors and the regularization of pending payments in priority areas.
Regarding economic activity, the report highlights growth in almost all sectors. The primary sector recorded a year-on-year change of 10.4% through March. The overall Monthly Indicator of Economic Activity of Paraguay (IMAEP) posted a change of 8.2%, while the IMAEP excluding agriculture and binational entities stood at 8.3%. Manufacturing expanded 4.5%.
Year-on-year inflation in April was 2.3%, within the Central Bank of Paraguay's target, up from 1.9% in March and below the 4% of April 2025. The increase is attributed to higher fuel prices. The Monetary Policy Committee kept the benchmark interest rate at 5.5% per year.
The nominal exchange rate continued to appreciate. In April, the average exchange rate was 6,348 guaraníes per dollar, with a year-on-year appreciation of 20.7%. Imports grew 13% in value and 7% in volume in the cumulative period through April, but the comparison base with 2025 shows a deterioration of 7.2%.
Domestic tax revenues grew 21% in April and 14.2% in the cumulative period. External revenues (customs duties) fell 15.1% in April and 8.4% in the cumulative period. Total revenues posted a cumulative increase of 1.9%, driven by domestic taxes, which rose 5.3%. Corporate Income Tax (IRE) contributed 6.3% of the growth, followed by VAT (5%) and the dividend tax (2.5%).
In contrast, external taxes fell 8.4%, with a notable 4.6% drop in VAT on foreign trade, along with lower inflows from other items (-1.7%) and tariffs (-1.5%).