El Salvador closed 2024 with a remarkable inflation rate of just 0.3%, the lowest in the last four years and one of the lowest globally. This figure outperformed countries like the United States (2.7%), Switzerland (0.7%), and Luxembourg (0.8%), despite the latter being a major source of imported goods for El Salvador. The data, released by the Central Reserve Bank (BCR), shows a 0.9 percentage point decrease from December 2023 and marks the fifth consecutive monthly contraction with a variation of -0.2%.
Food inflation also saw a significant improvement, ending 2024 at -0.5%. This represents a substantial decrease of 4.4 percentage points compared to the previous year. Key food items such as raw beans, tomatoes, chicken eggs, tortillas, green chili, and native corn saw price drops, thanks to increased market supply from national and regional harvests. The establishment of 55 agricultural markets and the first Central de Abasto in Soyapango, spearheaded by the Ministry of Agriculture and Livestock (MAG), also helped stabilize prices by promoting market competition.
The BCR report highlighted that El Salvador’s food prices benefited from the expansion of agricultural markets across the country, which alleviated the impact of international price fluctuations. For example, eggs sold at MAG stands were priced at $4.21, significantly lower than the $5.71 reported in the BCR’s Consumer Price Index (CPI).
This performance positioned El Salvador as the Central American country with the lowest food CPI, outperforming its regional neighbors such as Guatemala (3.6%), Costa Rica (0.8%), Nicaragua (4.6%), and Honduras (1.5%).
The overall inflation rate reduction was also driven by decreases in transportation (down 1.58%) and furniture and household items (down 2.18%). These drops, particularly in air travel and fuel prices, helped offset increases in restaurant and hotel costs.
With its exceptional inflation performance, El Salvador has not only demonstrated economic resilience but has also positioned itself as one of the most stable economies in the region.
