Economic growth will strengthen to around 3.5% in 2019 and 2020, as lower corporate taxes boost investment. Low inflation and interest rates will support consumption. With demand-driven growth and weak export performance, the current account deficit will widen. Poverty has fallen, but inequality and informality remain high. The mildly accommodative monetary policy stance is appropriate, with inflation expectations close to target and unemployment high. Fiscal policy will need to remain moderately prudent to let the deficit decline gradually in line with the fiscal rule. Boosting productivity requires more competition and openness to trade. A better targeting of social policies and further efforts to reduce labour market informality, by cutting non-wage labour costs further, would reduce inequalities.