IMF pressure meets sluggish growth as Uruguay revises 2026 forecast downward.

The visit that the Managing Director of the International Monetary Fund will pay to Montevideo to meet with President Yamandú Orsi, Minister Gabriel Oddone and the president of the Central Bank is no routine courtesy call: it comes at a moment when the IMF has explicitly called on Uruguay for a greater fiscal effort, and while the government itself concedes that the probability of revising its 2026 growth forecast downward is "quite high." It is the convergence of that external pressure with domestic fragility that defines the tone of Uruguay's current economic juncture.

The starting point is weaker than the authorities would like to acknowledge. The economy grew just 1.8% in 2025, below official projections and IMF estimates, and the opening of 2026 offers no unambiguous signs of acceleration. The first quarter posted an expansion of between 0.8% and 0.9% relative to the prior quarter — different sources offer slightly divergent figures — but that reading coexists with a Ceres leading index that has alternated between declines and modest recoveries, without tracing a sustained trend. The World Bank, for its part, has trimmed its projections to 1.6% for 2026 and 1.7% for 2027, and has labeled Uruguay a "superstar" that has lost ground. Private economists go further: at least one of the most closely followed local analysts warns that the country could grow less than 1% this year if the external environment does not improve.

The composition of 2025 growth illustrates the structural problem sharply. It was finance, agriculture and mining that accounted for the 4.4% advance recorded in one stretch of the year, while industry and commerce lagged behind. It is a pattern concentrated in high-productivity sectors with little multiplier effect on employment and domestic consumption. Household disposable income — the money left after fixed expenses — posted seven consecutive months of decline before stabilizing, curbing any genuine dynamism in domestic demand.

Against that backdrop, the fiscal debate takes on an urgency that goes beyond the technical. The Autonomous Fiscal Council has warned Parliament of an "overestimation" in the projections from the Ministry of Economy and Finance included in the Rendición de Cuentas, noting that the baseline growth figures on which the fiscal scenario is built are too optimistic. Oddone has responded that projection errors are "quite common" and has stood by the course, but the tension is real: the fiscal deficit closed 2025 at 4.1% of GDP, in line with what the MEF had projected but at a level that several economists consider unsustainable over the medium term unless growth accelerates. The Caja Militar required government financial assistance of USD 452 million last year, a drain with no easy political fix.

The Rendición de Cuentas, which includes a request for an additional USD 1 billion in resources, has become the legislative battleground of recent weeks. The government has warned that if the original text is not approved, it will seek to push through changes to social allocations via an "alternative law," which reveals both the Executive's determination and the parliamentary uncertainty. The opposition, meanwhile, has questioned the MEF's transparency, describing the failure to give advance notice of changes to the Fonasa reimbursement as a "stab in the back to trust."

On inflation, the picture is more benign but not without nuance. The Central Bank has recorded the lowest year-over-year inflation in 70 years, an achievement that has bolstered the credibility of monetary policy. Yet the BCU itself warns that price rigidities persist in services, suggesting that the disinflation process may have exhausted its easier gains. The gradual peso-ization of the economy is advancing, but the exchange rate remains a source of pressure: the dollar posted its largest weekly rise in six years due to the so-called "Middle East effect," and Minister Oddone has acknowledged that a sustained conflict in that region could constitute a "negative shock" via energy prices.

On the export front, the knowledge economy offers the most encouraging data point of the period: technology services exports have reached an all-time high, consolidating Uruguay as a relevant player in a high-value-added segment. The wheat harvest is also expected to contribute some USD 3.9 billion to the economy after a record crop, though drought hit soy and rice in the first quarter. The Unión Industrial Agremiada, meanwhile, insists that the tax burden on the formal economy is "the highest in the world," a warning that the government hears but prefers to address through competitiveness reforms rather than tax cuts.

The immediate horizon will be shaped by three variables: the approval or rejection of the Rendición de Cuentas in Parliament, the revision of the 2026 growth projections that Oddone himself has flagged as likely, and the outcome of the IMF's visit, whose public signal will weigh on international perceptions of Uruguay's fiscal solidity. The BCU, for its part, has submitted a draft bill to create an open finance system, a financial modernization initiative that, if it moves forward, could improve sector efficiency over the medium term. Uruguay retains its macroeconomic credibility — acknowledged even by leading international outlets — but the gap between that reputation and the economy's actual dynamism is today the central knot of its economic policy.

**Dique Capurro (port infrastructure project)** — A USD 20 million investment in Montevideo's Capurro dock aims to expand service capacity for Uruguayan and foreign fishing vessels, with a direct impact on fishing exports, a category of growing relevance in the country's trade balance.

**Google (NASDAQ: GOOGL)** — The Secretary of Innovation, Ignacio Vallcorba, confirmed that beyond Google's already-announced project in Uruguay, initiatives from other international technology companies are under evaluation — a signal that the country retains its appeal as an investment destination in the knowledge economy despite the broader slowdown.