Colombia | Economic growth started to moderate due to less dynamic final consumption

Summary

During the third quarter, the Colombian economy grew 7.0% YoY. Domestic demand continued to lead GDP dynamics, with a significant acceleration in fixed investment that offset the moderation of the expansionary cycle of final consumption. We expect 2022 growth to be around 8%.

Key points

• Key points:
• Domestic demand completed eight consecutive quarters of growth above GDP, remaining the largest source of expansion in the economy.
• Fixed investment accelerated with respect to the previous quarter due to the improved performance of the construction sector and the continued strong dynamics of firms spending on machinery and equipment.
• Both exports and imports decelerated, but more strongly in the former case. As a result, net foreign demand became more negative and subtracted more strongly from GDP growth.
• Private consumption slowed, especially in the goods component, but not so much in spending on services, which continued to grow at double-digit rates.
• This deceleration will continue for the following quarters, so we cannot rule out periods with negative GDP results during 2023, when economic growth is projected at 0.7% for the whole year.

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