Published on Thursday, August 18, 2022

Colombia | Colombian economy maintains strong growth in second quarter

GDP growth for the second quarter of 2022 was 12.6% YoY, higher than BBVA Research's expectations and analysts' average. A slowdown in the economy is expected for the second half of the year, where the moderation of household consumption will play a central role.

Key points

  • Key points:
  • The annual growth in the second quarter (12.6%) continued the robust dynamics recorded in the first quarter of the year (8.6%). The production branches that contributed most to this year-on-year growth were: household activities, accommodation and food services, artistic activities, and manufacturing.
  • Consumption grew 12.5%, driven by private (household) consumption, which grew 14.6% annually (above GDP growth).
  • Fixed investment grew below GDP, at 9.6%. This growth was driven especially by investment in machinery and equipment with an annual growth of 21.2%, although a quarterly (seasonally adjusted) growth of -0.3%, reflecting a slowdown in quarter-on-quarter dynamics.
  • In terms of external demand, imports continue to gain weight in GDP, reaching 27%, higher than the average of the last 5 years (22%), with an annual growth of 32% for the quarter. Exports grew by 31.8%, driven by the growth of external sales of fuels and extractive industry products.
  • The second half of the year is expected to be characterized by a gradual and healthy slowdown of the economy, where the moderation of household consumption will be key to increase household savings levels and, consequently, reduce pressures on prices and on the external balance.

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