Dominican Republic’s Current Account to Remain Largely Stable in 2026

  • The Dominican Republic’s current account is expected to remain largely stable in 2026 and narrower than historical run rates. BMI forecasts a current account deficit of 2.5% of GDP in 2026, edging up slightly from an estimated 2.2% of GDP in 2025. Still, this would represent an improvement over both pre- and post-pandemic averages of 3.5% of GDP in 2010–2019 and 3.9% of GDP in 2021–2024, respectively.
  • The current account balance remained stable in the third quarter of 2025 (Q3 2025) compared with the previous quarter, while showing marked improvement from a year earlier. The deficit narrowed by 37.8% from US$3Bn to US$1.8Bn. Furthermore, preliminary Q4 2025 data from the Banco Central de la República Dominicana (BCRD) support the view that the current account deficit will remain relatively narrow through the end of 2025 and into 2026.
  • While U.S. trade policy remains volatile and unpredictable, there remains little risk that the sovereign will be the subject of increased tariffs in 2026, given broadly stable relations between Washington and Santo Domingo and the U.S.’s ongoing trade surplus with the country. This, along with an upbeat precious metals price outlook in 2026, should support exports and the current account through terms-of-trade tailwinds.
  • While risks to the overall sustainability of the Dominican Republic’s external sector are mitigated by buffers, including adequate levels of foreign-exchange reserves, the current account outlook is potentially more volatile. Although tourism ended 2025 on a strong footing, the outlook for Caribbean tourism is more muted, with the potential for storms, geopolitical tensions, and other headwinds to curb gains seen in 2025 and weigh on the services trade balance.
  • Moreover, while higher gold prices provided a terms-of-trade boost in 2025, a correction in gold prices could lead to a deterioration in the current account in 2026. Finally, with growth set to accelerate in 2026, from 2.3% to 3.8%, expectations are for import demand to pick up, which should see the current account deficit expand modestly.

(Source: BMI, A Fitch Solutions Company)