Economic outlook and financial market trends: Dominican Republic profile

What it is about

Joel González Pantaleón, from the Monetary Programming and Economic Studies Department of the Central Bank of the Dominican Republic, presented at the Fourth Annual Risk Conference (September 16, 2026) how the world economy and the Dominican economy have navigated uncertainty, and where monetary policy is heading.

The 29 slides distinguish risk from uncertainty, explain why uncertainty harms spending, saving and investment decisions and review its sources: geopolitical conflicts affecting energy markets, changes in trade policy and extreme weather events. They then review the world economy and the United States, the performance of the Dominican external sector, the Central Bank actions against climate change and the outlook for inflation, growth and the financial system.

Objectives

• Distinguish risk from uncertainty and explain how uncertainty is measured and why it affects monetary policy.
• Review the recent shocks (geopolitical, trade and climate) and their effect on the world and Dominican economies.
• Present the Central Bank policy response and the economic outlook for 2026 and 2027.

Key takeaways

1. Risk has a known probability of materializing; with uncertainty the possible scenarios and their probabilities are unknown, which is why households and companies postpone decisions.
2. Uncertainty is measured with market-based indicators, forecast-error indicators and text-based indicators, such as mentions in central bank speeches.
3. Between January and July 2026 remittances reached US$7,316.4 million (up 6.4%), exports US$10,277.8 million (up 14.2%) and, between January and June, tourism US$6,709.8 million (up 15.2%).
4. The Central Bank kept its policy rate unchanged in 2026 and used complementary measures: macroprudential tools, liquidity management, alternative scenarios and active communication.
5. Growth is projected at 4.5% in 2026 and 4.5% to 5.0% in 2027, with inflation returning to the target range in the last quarter of the year and a robust financial system.