This content was published on June 22, 2023 – 17:15
Bogotá, June 22 (EFE).- The Colombian economy will grow by 1.2% in 2023 and 1.5% in 2024, according to projections by BBVA Research presented this Thursday, indicating that inflation will “decrease gradually” until it reaches 9.2%. By the end of this year.
The analysis indicates that “the Colombian economy continues its process of orderly decline”, but good indicators of employment, private consumption and exports boost growth forecasts this year, with gross domestic product (GDP) at 1.2%. , an upward revision from the 0.7% forecast in March.
By 2024, the bank’s panel of economists predicts GDP to be 1.5%.
The Colombian government – and the OECD – project that the economy will grow by 1.8% this year and 1.5% in 2024, compared to GDP growth of 7.5% last year. For its part, the International Monetary Fund (IMF) has forecast growth of 1% in 2023 and 1.9% in 2024.
BBVA Research analysis concludes that the economic sectors with the best results at the beginning of the year were those related to services including hotels and restaurants, events and online betting.
On the contrary, sectors related to manufacturing, trade, transport and storage of goods slowed down sharply and remained in negative territory in terms of output and investment results.
Economic perspective
The dynamics of the Colombian economy “will be led by the service sector, while the consumption of durable and semi-durable goods will continue a sharp decline, which will begin to change its direction upwards from the first quarter of 2024”.
This factor means that “entrepreneurs will make fewer investment decisions, a significant downward correction this year from high levels and a slight recovery in 2024,” explained Mauricio Hernandez, economist at BBVA Research for Colombia.
As for inflation, a “progressive decline from the second quarter of 2023” has already begun, and it will gradually decrease, reaching 9.2% by the end of this year.
As for the behavior of the dollar, analysts expect downward pressure on the exchange rate to continue as the country’s fiscal and external deficits are higher than those prevailing in economies of similar growth.
Therefore, the exchange rate is expected to be 4,600 pesos at the end of 2023 and 4,698 at the end of 2024.
“The expected performance of the Colombian economy in 2023 and 2024 will be determined by the extension of the behavior already observed, the expected reduction path for inflation, the effects of the restrictive monetary policy that has been in place for a long time in the country. The impact of the recession in developed countries,” explains the study of economists. EFE
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