Honduras Economy News

Honduras increased its temporary fuel subsidy from 50% to 65% to cushion households from rising global oil prices, with new fuel prices taking effect September 14 in Tegucigalpa and San Pedro Sula.

The Central Bank of Honduras auctioned $72.8 million in a currency sale on September 11, setting the weighted average exchange rate at L26.8833 per dollar for September 12–14.

The Central Bank forecasts annual inflation reaching 4.98% by December 2026, within its target range of 4.0% ± 1.0 percentage point, with further declines expected ahead.

Honduras's electricity regulator warns that Congress-approved reforms to the power sector remain unsigned and unpublished, delaying their implementation even as daily blackouts persist due to insufficient generation capacity.

Merchandise imports grew 11.3% year-over-year in the first seven months of 2026, driven mainly by increased purchases of fuel and transport equipment, particularly commercial vehicles.

More than 117,000 Honduran women are unemployed with a joblessness rate of 6.8%, nearly double the 3.7% rate for men, reflecting barriers women face in entering the formal labor market despite Labor Minister Fernando Puerto's claim they have greater presence once employed.

New blackouts struck multiple cities including Tegucigalpa on September 11 as the National Dispatch Center (CND) activated emergency measures to manage fuel shortages and forced outages, prompting experts to warn the crisis could worsen.

Finance Minister Emilio Hércules announced that IMF Director Nigel Chalk will lead a technical mission to Honduras to conduct the sixth review of the country's ongoing IMF program.

The official gazette published a salary increase of L1,200 (about $48) per month for central government employees, agreed between the government and three labor unions on August 26.

Honduran labor law requires employers to pay double salary to workers laboring on September 15 (Independence Day) and grant them a compensatory rest day during the same week.

Year-on-year inflation in Honduras reached 6.20% in August 2026, driven by rising fuel, food, and electricity costs amid adverse weather that has damaged agricultural output and pushed 64% of the goods and services in the consumer basket higher.

Honduras's Energy Ministry announced price increases for all fuel types effective September 14, with premium gasoline and kerosene rising by up to L3.86 per gallon in Tegucigalpa and similar increases in San Pedro Sula, while domestic cooking gas remains subsidized.

Small-business owners in the Sula Valley report daily losses of approximately L10 million (about $400,000) from six- to eight-hour power outages in September, with three blackouts so far accumulating roughly L30 million in damages.

Construction and tourism industry leaders say they can absorb thousands of Hondurans returning due to TPS (Temporary Protected Status) termination, citing demand for bilingual, skilled workers, though they stress the need for government coordination.

President Asfura blamed widespread blackouts and power rationing on peak-hour demand and fuel shortages at generating plants, while announcing that Congress-approved energy reforms await final review before publication and that roughly 1,500 megawatts will be tendered to stabilize the grid.

Honduras's economy expanded 4.8% in the first seven months of 2026, officials said, driven by employment generation, consumer spending, and business activity that sustained growth momentum through mid-year.

The Honduran private-sector council (Cohep) is calling for the 2027 national budget of roughly 457 billion lempiras to prioritize productive investment and job creation over current spending, citing concerns about low public-investment execution.

The Central Bank of Honduras stated that core inflation in August reflects its monetary-policy stance to mitigate fuel-price volatility and effects of El Niño, citing international uncertainty from the US–Iran conflict that has driven up global fuel costs since late February.

The National Congress established a working group with legislators and government officials to investigate rising prices in essential foods and household goods, identify speculative pricing, and determine legal penalties for unjustified increases.

Honduras must improve transparency, anti-corruption controls, and institutional oversight to qualify again for funding from the US-backed Millennium Challenge Account, according to a governance expert who highlighted recent reforms in energy and beneficial-ownership disclosure as steps forward.

ENEE's manager Guillermo Peña Panting says stabilizing power supply is the immediate priority as the utility faces infrastructure weakness that could extend through 2026 and into next summer, while the recently approved electricity sector reform begins implementation.

Miguel Aguilar, president of the STENEE electrical workers' union, says Hondurans are exhausted by rolling blackouts driven by drought, low reservoir levels, and diesel shortages, and urges the government to pursue long-term fixes—including over 1,800 megawatts of new generation capacity rather than the 600 megawatts announced.

President Asfura announced plans to bid out approximately 600 megawatts of new electric-generation capacity to reduce reliance on costlier spot-market power and lower electricity costs, while reporting his administration has halved the overdue payments owed to power generators.

Honduras projects the 2026–2027 coffee harvest, beginning in October, could exceed 7.5 million sacks and generate over $2.4 billion in export revenue if favorable weather holds and international prices stay above $300 per unit.

Honduras banana exports remain stagnant at around $20 million as fertilizer costs surge 300%, prompting many farmers to sell their land and exit the sector, industry leaders warn.

ENEE's 400-megawatt diesel-lease contract, signed under former management, requires the state utility to buy fuel at over $100 per barrel, driving generation costs above 45 cents per kilowatt-hour and forcing rolling blackouts that a partial rate freeze cannot offset.

Honduras's new Energy Justice Law freezes electricity rates for six months, but the Electricity Regulatory Commission warns that bills can still increase if household consumption rises or if commercial charges apply.

Unannounced electricity cuts in San Pedro Sula are causing production delays and losses for small workshops and artisans, with some considering closure due to lost income and the prohibitive cost of private generators.

Honduras's power regulator announced it has contracted two new fuel suppliers to help reduce nationwide electricity blackouts, a longstanding problem affecting the country's grid reliability.

Three blackouts lasting 6 to 8 hours in September have cost small and medium-sized businesses in the Valle de Sula an estimated 30 million lempiras (about $1.2 million), with most lacking backup generators to sustain operations, a sector representative said.