Inflation

Diesel prices have surged 69.8% since January to L141.67 per gallon and premium gasoline 49.6%, with another increase taking effect August 3 that economists warn will drive up transport and food costs.

Red beans jumped 5 lempiras to 110–116 lempiras per measure at Tegucigalpa's Feria del Estadio market this week, with producers warning of further increases in about three weeks as the new harvest arrives; onions, beets, corn, pataste (chayote squash), and cauliflower also rose due to low supply from prolonged dry weather.

Honduras's basic basket of essential goods has climbed to around L17,000 (about $680) in 2026, driven by a 24% increase in electricity rates and volatile fuel prices that consumer advocates say are pushing food staples out of reach for poor Hondurans.

Cabbage, onions, and beans posted price increases at Tegucigalpa markets this week, with vendors citing low production and warning that bean prices may climb further in August as new harvests arrive.

Honduras's Central Bank is implementing measures to absorb excess money circulating in the economy and stabilize resources, as inflation reached 5.83% year-over-year in June, while president Roberto Lagos cited supply-driven pressures and limited scope for interest-rate policy.

ASJ economist Obed García warned that rising energy costs and imported inflation could push Honduras's consumer price index up by 1.4%–3.7%, citing CEPAL projections, and urged the government to boost public and productive investment to cushion household incomes.

Congressman Hugo Noé Pino of the Libre party warned that the El Niño drought's damage to food production will push inflation above 5% in the second half of 2026, and called for contingency plans to protect food security in hardest-hit regions.

A northern Honduras fuel distributor says crude-oil prices will continue climbing for at least two weeks due to Middle East tensions, though he notes price controls are managed through international regulations to prevent sharp spikes in the basic basket and inflation.

Honduras's basic food basket has risen to about L16,000 (roughly $640) per month, exceeding the average minimum wage of L14,917, forcing many families to send at least two earners to work just to cover food costs.

Honduras's basic food basket increased from L14,500 to L16,000 between December 2025 and July 2026, according to Artículo 19, with meat, dairy, beans, and vegetables driving the cost surge and squeezing household buying power.

The Central Bank of Honduras announced measures to reduce inflation, which reached 5.83% in June, by increasing open-market operations to drain excess money from the financial system starting in August, aiming to return inflation to its 4% target by year-end.

Economist Julio Raudales says the Central Bank of Honduras's inflation target of 5–6% is reachable if monetary policy remains disciplined and external shocks do not occur, though he cautions that balancing price control with economic growth remains a key challenge.

Economist Ismael Zepeda says the Central Bank will struggle to control inflation through monetary policy given international conflicts raising fuel costs and a planned electricity rate increase in the third quarter, though the bank aims to absorb excess money supply and cut monetary emissions by 11%.

Honduras's labor federations say they will immediately seek a minimum-wage adjustment if inflation reaches 7%, invoking a safeguard clause in the current wage agreement, citing rising fuel and food costs eroding workers' purchasing power.

Honduras's central bank raised its forecast for family remittances to grow 7% in 2026 (to $13.16 billion) and maintained a 3–4% economic growth outlook, though inflation and currency depreciation continue to pressure household purchasing power.

Economist Ismael Zepeda warns that each cent of lempira depreciation against the dollar directly raises costs for food, fuel, and services; the currency has weakened 1.5% in the first half of 2026, nearing 27 lempiras per dollar.

Juliette Handal, president of the Patriotic and Solidarity Coalition, called on the government to meet with business sectors to prevent them from raising prices in response to fuel-cost pressures.

Diesel and kerosene prices rose 47.8% and 41.5% respectively from January through May 2026 compared to the same period last year, though both fuels declined month-over-month in May.

At Roatán's Kennedy neighborhood market, cassava, potatoes, and chayote squash all rose in price, as did soap and detergent, even as egg cartons held steady at 98 lempiras (about $4).

Labor leader Hilario Espinoza said inspectors are distributed nationwide to verify employers are paying the legal minimum wage, though he acknowledged enforcement challenges and noted inflation has risen to 6%, approaching the 7% threshold that would trigger wage renegotiation.

Honduras registered a 5.83% annual inflation rate in June, the highest in Central America, with economist Dante Mossi warning that subsidy removals and price increases are pushing the poor toward extreme hardship and reducing consumer spending.

Juan Carlos Hernández, president of Honduras's Colegio de Economistas, defended the central bank's decision to hold its benchmark interest rate steady, arguing that lower rates would risk fueling inflation by increasing money in circulation without proportional growth in goods and services.

Honduras's banking system holds nearly 200 billion lempiras (about $8 billion) in excess liquidity, and economists say the central bank must manage the surplus and maintain its policy rate to avoid stoking inflation.

The Honduran fuel distributors' association says price reductions take longer to reach consumers than increases because of volatile global markets, summer demand surges abroad, and geopolitical uncertainty around Middle Eastern shipping routes.

The Central Bank of Honduras forecasts year-over-year inflation of 4.97% at the close of 2026, with a declining trend that would bring it within the monetary authority's target range of 3.0–5.0% by June 2028.

Gasoline and diesel have fallen for seven consecutive weeks in Honduras, but the basic food basket and public transportation costs continue climbing, with analysts noting that oil-price increases pass through quickly while decreases do not.

Economist Amparo Canales says Honduras must reassess its economic outlook due to unstable oil prices and rising international inflation, requiring a review of the monetary program in the third quarter as the economic environment shifts.

Potatoes at the Farmer and Artisan Fair near the National Stadium in Tegucigalpa have risen to 28 lempiras per pound (about $1.12), while dairy prices have fallen.

Potato prices at Tegucigalpa's El Lempirita market climbed to L25 per pound (about $1 per pound) due to reduced harvests from March-to-May drought, part of broader food-cost pressure straining household budgets.

The Central Bank of Honduras released its updated 2026–2027 monetary program, projecting inflation will converge to its 4.0% ± 1 percentage-point target by December 2026 and tightening money-supply measures to combat price pressures that reached 5.83% in June.