Uruguay GDP Growth Accelerates to 0.9% in Q1 2026, Driven by Consumption and Exports

Uruguay’s economy grew 0.9% year-on-year in the first quarter of 2026, accelerating from 0.1% in the previous quarter, according to official data. On a seasonally adjusted quarter-on-quarter basis, GDP expanded 0.8%, up from 0.2% in Q4 2025.

According to a report by FocusEconomics in FocusEconomics, the improvement was broad-based across demand components. Private consumption rose 2.9% year-on-year (vs. 1.9% in Q4), government consumption increased 2.9% (vs. 2.2%), and exports of goods and services grew 2.3% (vs. -1.9%). However, fixed investment contracted 3.1% (vs. -0.9% in Q4), and imports grew 4.7% (vs. 5.1%).

The recovery in exports was supported by solid expansions in the meat and services sectors. However, a severe drought weighed on agricultural output, likely affecting exports and rural household spending. Fixed investment declined due to sluggish construction activity, particularly in infrastructure, and a drawdown in inventories.

Looking ahead, the Economist Intelligence Unit (EIU) projects GDP growth will slow to 1.3% in 2026 from 1.8% in 2025, citing weak consumer and business confidence weighing on private consumption and investment.

Macroeconomic Outlook for Investors

For international investors and expats, Uruguay’s Q1 GDP data signals a modest recovery but persistent headwinds. The acceleration in consumption and exports suggests underlying demand resilience, while the contraction in fixed investment highlights caution in capital spending. The drought’s impact on agriculture, a key export sector, underscores vulnerability to climate shocks. Uruguay’s macroeconomic stability remains intact, but slower full-year growth may temper near-term investment returns. Investors should monitor consumer confidence and infrastructure policy for signs of a sustained rebound.